Sensor sales will continue to grow as prices tumble, says report

Market news | July 26, 2016

By Rich Pell

Sales of sensors made with microelectromechanical systems (MEMS) technology are expected to grow by 4% in 2016 to $4.8 billion with unit shipments increasing 10% to 7.6 billion. MEMS-based sensor sales will rise with a compound annual growth rate of 5.5% in the next five years to $6.1 billion in 2020 with unit shipments growing by an annual rate of 11.9% to nearly 13.4 billion. ASPs for MEMS-based sensors are expected to decline to $0.45 in 2020 from $0.61 in 2015.

Overall sensors will enjoy double-digit percentage annual increases in shipments with demand being strong for low-cost sensors for wearables systems, the Internet of Things and automated embedded control. However, that move to low-cost has also produced steep price erosion in several product categories, the market researcher asserts.

**Annual sensor unit shipments climb as ASPs tumble. Source: IC Insights.**

These sharply falling average selling prices (ASPs) can be seen in accelerometers, gyroscope chips, and magnetic-field measuring devices and this is capping annual growth of total sensor revenues in the low- to mid-single digit range.

The worldwide dollar market value for sensors is rising by a compound annual growth rate (CAGR) of 5.3% over the period 2015 to 2020 compared to an 8.9% annual rate from 2010 to 2015. Meanwhile sensor unit shipments are expected to climb by a CAGR of 12.4% in the five-year forecast period compared to a 20.5% rate of increase in the 2010-2015 period.

The sensor market grew by 1% in 2015 to reach $6.4 billion and will climb to $8.3 billion in 2020. Record sensor shipments are expected to continue for another five years, reaching 28.9 billion units in 2020.

The ASP for sensors moved from about $0.66 in 2010 to $0.40 in 2015. IC Insights reckons the sensor ASP will more than halve over the next five years to $0.29