Global Semiconductor Industry Revenues Cross $550 Billion In 2021

The revenues of global semiconductor industry increased 25.1% in 2021 to total $583.5 billion, crossing the $500 billion threshold for the first time, according to preliminary results by Gartner, Inc.

Intel and Samsung Electronics, which ranked first and second in 2020 respectively, swapped their rankings this year. Samsung regained the top spot from Intel for the first time since 2018 with revenues increasing 31.6% to $75.95 billion in 2021 from $57.73 billion in 2020. SK Hynix was in the third place and is followed by Micron Technology, Qualcomm, Broadcom, Media Tek, Texas Instruments, Nividia and AMD were other semiconductor manufacturers who figured among the top 10 companies globally.

While the combined revenues of these top 10 semiconductor vendors were $309.67 billion, those of other semiconductor companies across the world was $257.54 billion during 2021.

Chip shortages began making waves in the technology world in early 2021 due to various reasons and this had a cascading effect on the automobile industry with car makes cutting down their production.

More Investments

To meet the ever growing demand for semiconductor chips, Intel has announced that it will invest more than $20 billion in the construction of two new Ohio-based chip factories aimed at boosting production.

Even other vendors including Samsung, Texas Instruments and GlobalFoundries are planning to build or expand their semiconductor manufacturing presence in the U.S. within the next three to five years.

“As the global economy started recovering in 2021, shortages appeared throughout the semiconductor supply chain, particularly in the automotive industry,” said Andrew Norwood, research vice president at Gartner.

“The resulting combination of strong demand as well as logistics and raw material price increases drove semiconductors’ average selling price higher (ASP), contributing to overall revenue growth in 2021.

5G Smartphones Drives Industry Growth

“The 5G smartphone market also helped drive semiconductor revenue, with unit production more than doubling to reach 555 million in 2021, compared to 250 million in 2020. U.S. sanctions imposed on Huawei resulted in other Chinese smartphone OEMs gaining share and fuelling growth for 5G chipset vendors such as Qualcomm, MediaTek and Skyworks. Meanwhile HiSilicon, Huawei’s chip subsidiary, saw revenue decline from $8.2 billion in 2020 to around $1 billion in 2021.”

Memory was again the best-performing device category, primarily due to increased server deployments by hyperscale cloud providers to satisfy remote working, learning and entertainment needs, as well as a surge in end-market demand for PCs and ultramobiles. Revenue increased $42.1 billion over 2020, which amounted to 33.8% of overall semiconductor revenue growth in 2021.

Within memory, DRAM had the best performance with revenue growth of 40.4% in 2021, increasing revenue to $92.5 billion in 2021. Strong demand from servers and PCs created a DRAM undersupply that drove double-digit ASPs through most of the year.