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Global Semiconductor Market To Hit $522B In 2021

Despite supply constraints amid the pandemic, the global semiconductor market will reach $522 billion in 2021, a 12.5 percent year-over-year growth, according to the International Data Corporation (IDC). The robust growth will continue in consumer, computing, 5G, and automotive semiconductors. As technology has advanced, semiconductor chips have spread from computers and cars to toothbrushes and tumble dryers — they now lurk beneath the hood of a surprising number of products.

“Supply constraints will continue through 2021. While shortages initially occurred in automotive semiconductors, the impact is being felt across the board in semiconductors manufactured at older technology nodes,” the IDC said in a report this week.

The industry will continue to struggle to rebalance across different industry segments, while investment in capacity now will improve the industry’s resiliency in a few years. “Looking forward to 2021, IDC sees continued strong growth in semiconductor sales worldwide as adoption of cloud technologies and demand for data and services remain unchanged,” the report mentioned.

Worldwide semiconductor revenue grew to $464 billion in 2020, an increase of 10.8 percent compared to 2019. “Overall, the semiconductor industry remains on track to deliver another strong year of growth as the supercycle that began at the end of 2019 strengthens this year,” said Mario Morales, program vice president, Semiconductors at IDC.

The market for semiconductors in computing systems, such as PCs and servers, outpaced the overall semiconductor market, growing 17.3 percent (YoY) to $160 billion in 2020. The IDC forecasts computing systems revenues will grow 7.7 percent to $173 billion in 2021.

IDC forecasts mobile phone semiconductor revenues will grow by 23.3 percent in 2021 to $147 billion.

According to Rudy Torrijos, research manager, Consumer Semiconductors, “new gaming consoles from Microsoft and Sony, continued strong sales of wearables from Apple, and the rise in smart home networks managed by Amazon Alexa and Google Assistant will accelerate growth in 2021 to 8.9 percent year over year.”

Automotive sales recovered in the second half of 2020, but the supply constraints for the automotive semiconductor market for some products will last through 2021. For 2021, the IDC forecasts that automotive semiconductor revenue will grow 13.6 percent.

The world’s largest chip manufacturer, TSMC (Taiwan Semiconductor Manufacturing Company), said on Sunday that it thinks it will be able to catch up with automotive demand by June.  Nations are now being forced to think about how they can increase the number of chips they produce. The vast majority of the world’s chips are made in China, while the U.S. is the second-biggest producer. 

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