International Data Corporation (IDC) is predicting that worldwide semiconductor revenue will decline to $440 billion in 2019, down 7.2% from $474 billion in 2018. This follows three consecutive years of growth, with year-over-year growth of 13.2% in 2018.
Other key findings from IDC's Semiconductor Application Forecaster (excluding memory) include:
- While the computing industry experienced strong growth in 2017 and 2018, the SAF forecasts semiconductor revenue for the computing industry segment to decline 5.1% this year but will show a positive CAGR of 1.3% for the 2018-2023 forecast period. Two bright spots for the computing segment are x86 servers and SSDs, growing with an 11.3% and 9.8% CAGR respectively for 2018-2023.
- Semiconductor revenue for the mobile wireless communications segment will grow 1.8% year over year this year with a CAGR of 4.8% for 2018-2023. Semiconductor revenue for 4G mobile phones will experience a slowdown as 5G phones begin to ramp up in 2020, becoming mainstream by the middle of the next decade. RF subsystem in mobile devices will continue to drive the majority of the revenue growth as the subsystem continues to support more complexity, additional antennas, and the increase in bands on every phone.
- The consumer semiconductor segment will grow at a 6.4% CAGR for 2018-2023 as consumer IoT devices and home automation continue to gain traction and scale. Connected devices will continue to drive more sensors and processing at the edge.
"The current market downturn is being driven by a broad weakness in demand specifically centered in China and an ingestion of excess inventories in some of the major markets including automotive, mobile phones, and cloud infrastructure," said Mario Morales, program vice president, Semiconductors at IDC. "We expect the market to bottom by end of the third quarter this year as we work through inventories and demand begins to gradually return. Cloud infrastructure investment, 5G mobile devices, WiFi 6 adoption, Smart NICs, automotive sensors, powertrain technologies, AI training accelerators, and edge inference SoCs will be instrumental in our growth expectations for 2020 and beyond."
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