Infineon, ST rise in strong industrial chip market
Texas Instruments achieved 9 percent annual growth in its industrial semiconductor sales to retain its position as the number one supplier in 2018. TI is followed by Analog Devices, Infineon and STMicroelectronics making up a top four. But the highest Asian supplier is Renesas Electronics Corp. ranked 11.
Asian semiconductor manufacturers have tended to go after high volume markets – such as consumer and mobile communications – where they can make relatively few types of chip in high volumes and compete on economies of scale and price.
However, the lower volume higher diversity and higher value industrial chip market grew strongly in 2018 on demand generated by a plethora of new applications. The market expanded 10.8 percent to reach $52 billion in 2018.
Top 20 vendors of industrial semiconductors ranked by 2018 sales. Source: IHS Markit.
Fast-growing applications for industrial chips in 2018 included networking devices, commercial and military aircraft, LED lighting, digital signage, digital video surveillance, climate control, smart meters, traction, photovoltaic (PV) inverters and human-machine interface systems. Various types of medical electronic devices also helped propel growth, such as hearing aids, endoscopy and imaging systems.
The industry is expected to grow at a compound annual growth rate (CAGR) of 5.8 percent through 2023. This is a drop on the equivalent figure given by IHS-Markit last year of a CAGR over the period 2017 to 2022 of 7.1 percent.
The roll out of LED lighting, increased digitization of power electronics and industrial applicatons are having an impact. “Within the industrial semiconductor business, the markets for general-purpose analog ICs and optical semiconductors delivered stellar performances in 2018,” said Noman Akhtar, analyst, industrial semiconductors and sensors at IHS Markit Technology.
Microcontrollers (MCUs) for industrial applications are also projected to experience broad-based growth in the long term, thanks to advances in digitalization, power efficiency, connectivity and other features.
The combination of Analog Devices with Linear Technology had a positive effect as it grew 10 percent compared to 2017 and generated $3.1 billion in industrial revenue in 2018. The acquisition provided new opportunities for the company in diversified industrial segments within factory automation, military aerospace, video surveillance, test and measurement, medical and power and energy applications.
Infineon jumped one position to reach No. 3 in 2018 with industrial revenue of $2.9 billion. Company revenue increased by 16.9 percent in 2018 over 2017. Discrete insulated-gate bipolar transistors (IGBTs) and IGBT modules led the growth for the company’s top segments—home automation, industrial drives and various other energy applications.
Ranked No. 4, STMicroelectronics’ industrial semiconductor market revenue for 2018 totaled $2.8 billion. Owing to its discrete, analog and microcomponent integrated circuits (ICs), the company’s revenue increased in a broad-based manner across most of its segments including the factory and home-automation markets.
Despite attaining over 11 percent annual revenue growth, Intel dropped two ranks and landed at the 5th position with $2.6 billion in revenue in 2018. The company’s internet of things (IoT) division continued to generate healthy revenue growth because of its innovations and its strength in the factory automation, video surveillance and medical segments. Growth was also aided by the proliferation of smart and connected devices and a tremendous uplift in data analytics.
The acquisition of Microsemi catapulted Microchip Technology into seventh position. The combined Microchip Technology and Microsemi generated $1.9 billion in industrial revenue in 2018. This acquisition boosted Microchip’s industrial market share in power transistors, field programmable gate arrays (FPGAs) and analog application specific ICs (ASICs) in diversified segments like military and aerospace, building and home control and medical electronics.
On Semiconductor was ranked eighth in 2018, driven by manufacturing and process automation, including machine vision, power and energy, building automation and hearing aids and other medical devices.
NXP ranked ninth in the industrial market, based on its strong presence in manufacturing and process automation, building and home control, medical electronics and other industrial applications.
Xilinx made it to the top-10 list in 2018, with industrial electronics revenue growing to $1.2 billion in 2018. Growth was driven by FPGA solutions in military aerospace, test and measurement, manufacturing and process automation.
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