The speedy progress of synthetic intelligence dominated the information within the semiconductor business final yr. However even this upsurge couldn’t stop total semiconductor gross sales from sliding from 2022 ranges as the consequences of the post-COVID business stoop continued to linger.
In line with Omdia’s Aggressive Panorama Instrument, total semiconductor gross sales fell 9% from $597.7 billion in 2022 to $544.8 billion in 2023. The hangover of softening demand and better inventories reversed a COVID-era state of affairs of excessive demand and low inventories, famous Omdia Senior Analysis Analyst Cliff Leimbach.
With all the eye centered on AI, it’s not stunning that corporations which have centered their energies on creating GPUs and processors for generative AI and machine studying are reaping the advantages of AI progress. That was clearly borne out in Omdia’s rankings of high semiconductor suppliers, with Nvidia seeing its income soar 133% year-over-year to $49 billion. Nvidia leapfrogged South Korea-based Samsung to be the second largest semiconductor provider behind Intel. Whereas Intel has additionally been investing closely in AI, its 2023 income fell year-over-year from $60.8 to $51.9 billion, barely edging out Nvidia, because the business’s longtime main semiconductor provider continued to expertise the lingering results the post-COVID stoop in demand for PC and server processors.
Omdia’s rankings of semiconductor suppliers (see graph under) mirrored persevering with troubles for reminiscence suppliers, together with Samsung, Hynix, and Micron, all of whom noticed gross sales declines exceeding 30% as their inventories bulged amidst weak demand. Elsewhere, corporations that invested closely in markets akin to automotive, akin to Infineon and STMicroelectronics, managed to see their gross sales improve over 2022 ranges.
2023 Semiconductor Rankings By Income
AI-focused Nvidia noticed its 2023 income soar by 133% and rank the corporate behind solely Intel. (Omdia)
AI Driving 2024 Development
In a separate report, Omdia expects complete semiconductor income to high $600 billion in 2024, pushed by the expansion of generative AI and to a lesser extent stock changes by suppliers. A serious space of progress will likely be in AI accelerator chips, in keeping with Omdia Senior Analyst Claire Wen.
“NVIDIA presently dominates the AI accelerator market, notably for cloud and information heart deployments,” Wen stated. “Concurrently, main hyperscale cloud service suppliers like Google, Amazon, and Microsoft are creating their very own AI Utility Particular Built-in Circuits (ASICs) to reinforce cost-efficiency and efficiency tailor-made to their distinctive AI workloads. Furthermore, there is a notable rise in edge AI adoption, notably in AI PCs and smartphones, facilitated by the supply of compact AI fashions enabling offline AI utility execution.
One other market analysis agency, Gartner, additionally has an upbeat 2024 forecast. The agency tasks world semiconductor income to achieve $624 billion this yr, led by booming demand for components akin to accelerators for information heart servers to help each coaching and inference of AI workloads. However Gartner additionally predicts 2024 to be a bounce-back yr for different semiconductors, together with reminiscence.
In line with Gartner, NAND flash income declined by 38.8% to $35.4 billion in 2023. As costs degree off and inventories drop, demand is projected to get well and income will bounce by 49.6% year-over-year to $53 billion.
Likewise, Gartner expects improved market situations for DRAM, with costs rising from depressed 2023 ranges and total DRAM income rising 88% to $87.4 billion.
