Global chip sales bounce back

Global chip sales bounce back

Market news |
By Nick Flaherty

The global chip industry has shrugged off the global pandemic and hard-hit economies with a significant rise in sales in 2020.

Although the car industry closed down for nearly a quarter and is still struggling to recover, other parts of the market saw strong demand. This has led to a growth of 6.5 percent over the year to $439.0bn. Malcolm Penn at Future Horizons is predicting 18 percent growth for 2021.

Global sales for the month of December 2020 were $39.2 billion, an increase of 8.3 percent compared to the December 2019 total and 2.0 percent less than the total from November 2020. Fourth-quarter sales of $117.5 billion were 8.3 percent more than the total from the fourth quarter of 2019 and 3.5 percent higher than the total from third quarter of 2020.

The SIA represents 98 percent of the U.S. semiconductor industry by revenue and nearly two-thirds of non-U.S. chip firms. While the US saw strong growth, Europe was hit harder with a 6 percent fall in revenues.

At the same time the SIA called for US government support for semiconductors.

“Global semiconductor sales increased moderately on an annual basis in 2020, weathering a challenging macroeconomic environment brought on by the pandemic and other factors,” said John Neuffer, SIA president and CEO.

“While global demand for semiconductors is on the rise, the share of global chip production done in the U.S. has declined from 37 percent in 1990 to 12 percent today, and that disparity will only intensify without U.S. government action to level the global playing field,” he said.

“It’s imperative the federal government fully fund incentives for domestic chip manufacturing and investments in chip research so the U.S. can benefit from growing demand and produce more semiconductors needed to strengthen our economy, national security, and critical infrastructure.”

On a regional basis, sales into the Americas market stood out, increasing annually by 19.8 percent in 2020. China remained the largest individual market for semiconductors, with sales there totaling $151.7 billion in 2020, an increase of 5.0 percent. Annual sales also increased in 2020 in Asia Pacific/All Other (5.3 percent) and Japan (1.0 percent), but decreased in Europe (-6.0 percent). Sales for the month of December 2020 increased slightly compared to November 2020 in Asia Pacific/All Other (0.8 percent) and Japan (0.1 percent), but fell in Europe (-0.2 percent), the Americas (-3.0 percent), and China (-4.5 percent).

Several semiconductor product segments stood out in 2020. Logic ($117.5 billion in 2020 sales) and memory ($117.3 billion) were the largest semiconductor categories by sales. Annual sales of logic products increased by 10.3 percent compared to 2019, while sales of memory products were up 10.2 percent. Within the memory category, annual sales of NAND flash products stood out, increasing 23.1 percent to $49.5 billion in 2020. Sales of micro-ICs — a category that includes microprocessors — increased 4.8 percent to $69.6 billion in 2020. Sales of all non-memory products combined increased by 5.2 percent in 2020 and that category reached an all-time high in total sales.

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