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Global Semiconductor Market To Grow By 17.3% in 2021: IDC Report

The industry will see normalisation and balance by the middle of 2022, with a potential for overcapacity in 2023 as larger-scale capacity expansions begin to come online towards the end of 2022.

Global Semiconductor Market To Grow By 17.3% in 2021: IDC Report
Global Semiconductor Market To Grow By 17.3% in 2021: IDC Report
outlookindia.com
2021-09-22T12:44:13+05:30

The worldwide semiconductor market is expected to grow by 17.3% in 2021 versus 10.8% in the previous calendar year, according to research firm IDC.

The industry will see normalisation and balance by the middle of 2022, with a potential for overcapacity in 2023 as larger-scale capacity expansions begin to come online towards the end of 2022, an IDC statement said.

Growth is driven by mobile phones, notebooks, servers, automotive, smart home, gaming, wearables, and Wi-Fi access points, with increased memory pricing. IC shortages are also expected to continue easing through the fourth quarter of 2021 as capacity additions accelerate, it said.

Despite the current Covid-19 wave, consumption remains healthy.

IDC reports that dedicated foundries have been allocated for the rest of the year, with capacity utilisation at nearly 100%. “Front-end capacity remains tight but fabless suppliers are getting the production they need from their foundry partner,” the statement said.

Front-end manufacturing is starting to meet demand in the third quarter of 2021. However, larger issues and shortages will remain in back-end manufacturing and materials.

According to IDC, 5G semiconductor revenues will increase by 128%, with total mobile phone semiconductors expected to grow by 28.5%.

Game consoles, smart homes, and wearables will grow 34%, 20% and 21%, respectively.

Automotive semiconductor revenues will also increase by 22.8% as shortages are mitigated by year-end. Notebook semiconductor revenues will grow by 11.8%, while X86 Server semi revenues will increase by 24.6%, IDC said.

Semiconductor wafer prices increased in the first half of 2021 and IDC expects increases to continue for the rest of 2021 due to material costs and opportunity costs in mature process technologies.

Overall, IDC predicts the semiconductor market to reach USD 600 billion by 2025 – representing a CAGR of 5.3% through the forecast period. This is higher than the typical 3-4% mature growth seen historically.

(With inputs from PTI)

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