Global Semiconductor Revenue to Decline 11% In 2023: Report

A new report by Gartner projects the worldwide semiconductor revenue to decrease by 11.2 per cent in 2023.

The market brought in revenue to the tune of USD 599.6 million in 2022, a marginal growth of 0.2 per cent from 2021. But the semiconductor revenue is forecasted to total USD 532 billion in 2023.

“As economic headwinds persist, weak end-market electronics demand is spreading from consumers to businesses, creating an uncertain investment environment. In addition, an oversupply of chips which is elevating inventories and reducing chip prices, is accelerating the decline of the semiconductor market this year,” said Richard Gordon, Practice Vice President at Gartner.

The report also looked at the stagnating PC, tablet and smartphone semiconductor markets. The combined markets will represent 31 per cent of semiconductor revenue in 2023 and total USD 167.6 billion. “These high-volume markets have saturated and become replacement markets devoid of compelling technology innovation,” said Gordon.

At the same time, the automotive and industrial, military/civil aerospace semiconductor markets are expected to grow. The automotive semiconductor market is forecast to grow 13.8 per cent, reaching USD 76.9 billion in 2023.

Meanwhile, the report projects the semiconductor revenue to grow in 2024 by 18.5 per cent to 630.9 billion in 2024.

Deglobalisation Trend And Rise Of Techno Nationalism

Gordon said that the semiconductor industry was facing a number of long-term challenges in the decade to come. “The past decades of high volume, high-dollar content market drivers are coming to an end, notably in the PC, tablet and smartphone markets where technology innovation is lacking,” he explained.

He also pointed out the trade tension between the US and China which is pushing the deglobalisation trend and the rise of techno nationalism. “Semiconductors today are seen as a national security issue,” said Gordon. “Governments around the world are scrambling to build self-sufficiency in the semiconductor and electronics supply chain. This is leading the incentivization of onshoring initiatives across the world.”