Global semiconductor market grows
Worldwide semiconductor revenues grew by 9.2 percent in 2014 coming in just slightly below the growth projection of 9.4 percent based on preliminary market share data, according to information provided by IHS Technology. The year ended on a strong note with the fourth quarter showing 9.7 percent year-over-year growth. IHS semiconductor market tracking and forecasts mark the fourth quarter of 2014 as the peak of the annualized growth cycle for the semiconductor industry.
Global revenue in 2014 totaled $354.5 billion, up from $324.7 billion in 2013, according to a final annual semiconductor market shares published by IHS Technology). The nearly double-digit percentage increase follows solid growth of 6.6 percent in 2013, a decline of 2.6 percent in 2012 and a marginal increase of 1.3 percent in 2011. The performance in 2014 represents the highest rate of annual growth since the 33 percent boom of 2010.
“While 2014 marked a peak year for semiconductor revenue growth, the health of both the semiconductor supply base and end-market demand, position the industry for another year of strong growth in 2015,” says Dale Ford, vice-president and chief analyst at IHS Technology. “Overall semiconductor revenue growth will exceed 5 percent in 2015, and many component categories and markets will see improved growth over 2014. The more moderate 2015 growth is due primarily to more modest increases in the memory and microcomponent categories. The dominant share of semiconductor markets will continue to see vibrant growth in 2015.”
Top 10 maneuvers
Intel maintained its strong position as the largest semiconductor supplier in the world followed by Samsung Electronics and Qualcomm at a strong number two and three position in the rankings. On the strength of its acquisition of MStar, MediaTek jumped into the top 10 replacing Renesas Electronics at number 10. The other big mover among the top 20, Avago Technologies, also was boosted by an acquisition, moving up nine places to number 14 with its acquisition of LSI in 2014.
Strategic acquisitions continue to play a major role in shaping both the overall semiconductor market rankings and establishing strong leaders in key semiconductor segments. NXP and Infineon will be competing for positions among the top 10 semiconductor suppliers in 2015 with the boost from their mergers/acquisitions of Freescale Semiconductor and International Rectifier, respectively.
Among the top 25 semiconductor suppliers, 21 companies achieved growth in 2014. Out of the four companies suffering declines, three are headquartered in Japan as the Japanese semiconductor market and suppliers continue to struggle.
As noted in the preliminary market share results, 2014 was one of the healthiest years in many years for the semiconductor industry. Five of the seven major component segments achieved improved growth compared to 2013 growth. All of the major component markets saw positive growth in 2014. Out of 128 categories and subcategories tracked by IHS, 73 percent achieved growth in 2014. The combined total of the categories that did not grow in 2014 accounted for only 8.1 percent of the total semiconductor market.
Out of more than 300 companies included in IHS semiconductor research, nearly 64 percent achieved positive revenue growth in 2014. The total combined revenues of all companies experiencing revenue declines accounted for only roughly 15 percent of total semiconductor revenues in 2014.
Memory still delivered a strong performance driven by continued strength in DRAM ICs. However, memory market growth declined by a little more than 10 percent compared to the boom year of 2013 with over 28 percent growth in that year. Growth in sensors & actuators came in only slightly lower than 2013.
Microcomponents achieved the strongest turn around in growth moving from a -1.6 percent decline in 2013 to 8.9 percent growth in 2014. It also delivered the best growth among the major segments following memory ICs. Even Digital Signal Processors (DSPs) achieved positive growth in 2014 following strong, double-digit declines in six of the last seven years. MPUs lead the category with 10.7 percent growth followed by MCUs with 5.4 percent growth.
Every application market delivered strong growth in 2014 with the exception of Consumer Electronics. Industrial Electronics lead all segments with 17.8 percent growth. Data Processing accomplished the strongest improvement in growth as it grew 13.7 percent, up nearly 10 percent from 2014. Of course, MPUs and DRAM played a key role in the strength of semiconductor growth in Data Processing. The third-strongest segment was Automotive Electronics which was the third segment with double-digit growth at 10 percent. Only Wireless Communications saw weaker growth in 2014 compared to 2013 as its growth fell by roughly half its 2013 level to 7.8 percent in 2014.