After going through the first three quarters when some prognosticators said this was a possibility, Gartner's preliminary results for semiconductor worldwide revenue of $339.8 billion in 2014 translated into just 7.9 percent growth from 2013 revenue of $315 billion. However this was an increase from the estimate given by Gartner in July 2014 (see Gartner raises 2014 chip market growth forecast).
The top 25 vendors combined revenue did show double-digit percentage growth for the year at 11.7 percent and they were responsible for 72.1 percent of the total market revenue up from 69.7 percent in 2013. So clearly the underperformance came with some of the second tier and smaller chip companies, some of which disappeared in mergers and acquisitions during 2013 and 2014. Gartner reckons that, after adjusting for M&A activity, the top 25 vendors grew at 10.0 percent, while the rest of the market saw growth of 2.6 percent.
A trend towards consolidation may have taken a bit of gloss off the growth but in one market where that consolidation has already taken place – memory – increasing average selling prices were able to create boom conditions. The memory vendors Samsung, Micron Technology and SK Hynix achieved the highest year-on-year percentage growth.
And the PC market – which had stalled in 2012 and 2013 casting a pall over the chip market – made a return to growth in 2014.
Top 10 semiconductor vendors by revenue, worldwide, 2014 (millions of dollars). Source: Gartner.
As a result Intel also returned to growth after two years of decline. Gartner reckons Intel increased sales by 4.6 percent. Intel has maintained the No. 1 market share position for the 23rd consecutive year, capturing 15.0 percent of the 2014 semiconductor market, down slightly from its peak of 16.5 percent in 2011. But Qualcomm, leading supplier of application processors for mobile equipment, grew faster at 11.5 percent.
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