Semiconductor M&A Accelerates in 2019
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In an ugly turnaround from last year, IC growth rates in 2019 are expected to be heavily weighted toward the negative side of the chart, with nine segments forecast to see a sales decline of 10 percent or more, according to market research firm IC Insights. Sixteen product categories are expected to experience flat sales or a single-digit decline in revenue growth.
Eight of 33 IC product categories are forecast to see an increase in sales in 2019, led by industrial/other—special purpose logic, which is forecast to jump 38 percent this year, followed by display drivers and PLDs. In 2018, 22 IC product categories experienced sales growth—16 of those with at least 10 percent growth.
The IC Insights' 2019 ranking of revenue growth rates is based on 33 IC product categories as defined by the World Semiconductor Trade Statistics (WSTS) organization.
After two years of leading the industry in sales growth, the DRAM market is forecast to face the biggest decline this year, ranking it at the bottom of the 2019 sales growth list. NAND flash and SRAM are expected to join DRAM as the only categories with weaker growth than the total IC market (-15 percent).
Despite the expected sales decline this year, the DRAM market is forecast to remain the largest of all IC product categories in 2019 with sales reaching $62.0 billion, down from $99.4 billion in 2018. IC Insights believes the DRAM market will account for 17 percent of total IC sales in 2019. By comparison, DRAM sales accounted for 23.6 percent of the total IC market in 2018.
The NAND flash market is forecast to slip from second to third position in the ranking this year with total sales falling 32 percent to $40.6 billion. Taken together, the DRAM and NAND flash memory categories are forecast to account for 29 percent of the total $357.7 billion IC market in this year compared to 38 percent of the total IC market in 2018.
The WSTS Spring 2019 global semiconductor sales forecast projected the semiconductor industry’s worldwide sales will be $412.1 billion in 2019. This would mark a 12.1 percent decrease from the 2018 sales total of $468.8, which was the industry’s highest-ever annual total. WSTS projects year-to-year decreases across all regional markets for 2019: Europe (-3.1 percent), Asia Pacific (including China) (-9.6 percent), Japan (-9.7 percent), and the Americas (-23.6 percent). In 2020, the global market is projected to bounce back somewhat, posting moderate growth of 5.4 percent.
WSTS tabulates its semi-annual industry forecast by convening an extensive group of global semiconductor companies that provide accurate and timely indicators of semiconductor trends.
Additional details on semiconductor and IC market trends are provided in the IC Insights' Mid-Year Update to The McClean Report. To review additional information about IC Insights’ new and existing market research reports and services please visit our website: www.icinsights.com.
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