Gartner Forecasts Worldwide Semiconductor Revenue Growth to Decline 3.6% in 2023
November 30, 2022 | Gartner, Inc.Estimated reading time: 2 minutes
Global semiconductor revenue is projected to decline 3.6% in 2023, according to the latest forecast from Gartner, Inc. In 2022, the market is on pace to grow 4% and total $618 billion.
“The short-term outlook for semiconductor revenue has worsened,” said Richard Gordon, Practice Vice President at Gartner. “Rapid deterioration in the global economy and weakening consumer demand will negatively impact the semiconductor market in 2023.”
Global semiconductor revenue is forecast to total $596 billion in 2023, down from the previous forecast of $623 billion.
Currently, the semiconductor market is polarized between the consumer-driven markets and enterprise-driven markets. Weakness in the consumer-driven markets is being driven largely by the decline in disposable income caused by rising inflation and interest rates, but also by the reprioritization of consumer discretionary spending to other areas such as travel, leisure and entertainment, which are having a negative knock-on effect on technology purchases.
On the other hand, the enterprise-driven markets, such as enterprise networking, enterprise compute, industrial, medical and commercial transportation, have, so far, been relatively resilient despite looming macro-economic slowdown and geopolitical concerns.
“The relative strength in the enterprise-driven markets comes from strategic investments by corporations that are looking to strengthen their infrastructure to continue supporting their work from home workforce, business expansion plans and ongoing digitalization strategies,” said Gordon.
Memory Revenue to Decline 16% in 2023
For the remainder of 2022, the memory market is witnessing faltering demand, swollen inventories and customers pressing for considerably lower prices. As a result, the memory market will remain flat in 2022 and is forecast to decline 16.2% in revenue in 2023.
The worsening economic outlook is negatively impacting smartphone, PC and consumer electronics production which is positioning the DRAM market for oversupply for the remainder of 2022 and the first three quarters of 2023. Gartner analysts foresee DRAM revenue to decrease 2.6% to reach $90.5 billion in 2022 and will further decline 18% in 2023, to total $74.2 billion.
The NAND fab outage which occurred in the first quarter of 2022 increased prices and masked the rapidly deteriorating demand environment, resulting in excess inventory in the third quarter of 2022 which is expected to carry into the first half of 2023. NAND revenue is projected to increase 4.4% to $68.8 billion in 2022, but it is on pace to decline 13.7% in 2023 to $59.4 billion.
“While the deterioration in the macroeconomic environment will weaken consumer demand, we expect relatively better semiconductor consumption from business investments. Consequently, markets such as industrial, telecom infrastructure and data center will be less impacted by consumer sentiment and spending in the short term,” said Gordon.
Suggested Items
SPEA Expands in Southeast Asia with New Subsidiary in Thailand
05/17/2024 | SPEASPEA, a global leader in automatic test equipment for the manufacturing of semiconductor, microelectronic and electronic devices, today announced the opening of its new subsidiary in Thailand. This expansion marks a significant step forward in SPEA's commitment to serving the growing Southeast Asian microchip and electronics market with leading-edge manufacturing machinery and equipment.
PCB Market Size to Grow by $29.06B from 2024-2028
05/17/2024 | PRNewswireThe global printed circuit board (PCB) market size is estimated to grow by USD 29.06 bn from 2024-2028, according to Technavio. The market is estimated to grow at a CAGR of over 6.6% during the forecast period.
AT&S 2024/25 on Growth Course Again
05/17/2024 | AT&SAT&S operated in a challenging market environment in the financial year 2023/24. After a strong second quarter, demand was relatively weak again in some market segments in the second half of the financial year.
Shipments of OLED Monitors Hit 200,000 Units in 1Q24, Annual Forecast to Reach 1.34 Million
05/17/2024 | TrendForceTrendForce’s latest report reveals a robust start to 2024 for OLED monitors, with shipments reaching approximately 200,000 units in the first quarter—marking a YoY growth of 121%.
Magnachip Celebrates the Grand Opening of Magnachip Technology Company in China
05/16/2024 | MagnachipMagnachip Semiconductor Corporation celebrated the opening ceremony of Magnachip Technology Company, Ltd. (MTC) yesterday at its headquarters located in Hefei, China. MTC is a subsidiary of Magnachip, established on December 20, 2023, to expand the Company’s display driver IC and power IC businesses in China.