Global Integrated Circuits Market - 2023-2030

Global Integrated Circuits Market - 2023-2030

Global Integrated Circuits Market reached US$ 474.3 billion in 2022 and is expected to reach US$ 1,103.5 billion by 2030, growing with a CAGR of 12.6% during the forecast period 2023-2030.

The semiconductor industry constantly develops fast and efficient integrated circuits. The adoption of smartphones and other consumer electronics items has been a major driver for the growth of the market. Globalization of electronics manufacturing has expanded the reach of integrated circuits and makes them accessible in the market worldwide.

In 2020, China became world’s largest and fastest growing market in the field of integrated circuit sector and has net worth of Yuan 880 billion. During its five year plan the market grows about 20% and reached up to Yuan 884.8 billion that is 4 times higher than global expansion rate. Further ongoing research and development is going and results breakouts which drives the market.

During the forecast period, with around 1/4th of the global integrated circuits market, North America is expected to show a healthy growth. More advanced and specialized integrated circuits are required due to the increasing demand for electronics from various industries. For instance, on 20 September 2023, Amitron Corporation, a prominent U.S. based manufacturer of printed circuit boards and provider of electronic manufacturing services, introduced a new industry column aimed at promoting American manufacturing technology.

Dynamics

Rising Fab Capacities Increases the Market Demand

Higher IC production capacities are required because there is increasing demand for electronic products, including smartphones, tablets, laptops, IoT devices, automotive electronics and more. Advanced and specialized ICs are necessary for emerging technologies like 5G, AI, machine learning and the Internet of Things and there is a demand for fabs to develop ICs that can support these applications as these technologies gain acknowledgment.

According to the report by SemiFab in September 2023, fab equipment spending reached a record high of US$ 99.5 billion. in 2023, there is an expected decline of 15% year-over-year (YoY) to US$ 84 billion and this decline is attributed to softening chip demand and an elevated inventory of consumer and mobile devices. The recovery in fab equipment spending in 2024 is expected to be driven by several factors. One of the key factors is the end of the semiconductor inventory correction in 2023.

Growing Demand for Ultra-Low-Cost Flexible Integrated Circuits

The internet of Things witnessed significant growth is the rising industries and increased demand for low-cost ICs and which is integrated into various devices like sensors, wearable devices and smartphones. Ultra-low-cost flexible ICs leads to offer cost advantages which in terms for production for making them an attractive choice for manufacturing which aims to reduce expenses.

For instance, on 18 October 2021, PragmatIC Semiconductor, a leader in flexible electronics, has secured US$ 80 million in Series C funding. The investment will be used to establish a second FlexLogIC fab in the North East of England to meet the rising demand for ultra-low-cost flexible integrated circuits (FlexICs) for the Internet of Everything (IoE) and this initiative aims to strengthen UK's position as a leading designer and manufacturer of next-generation semiconductor.

Collaboration between Companies Boosts the Market

Collaboration between global governments, research institutions and semiconductor businesses encourage innovation and hastens the development of new technologies. Standards are essential to the semiconductor business because they ensure compatibility and interoperability. The creation and adoption of these standards requires collaboration. To provide comprehensive solutions for end users, semiconductor companies frequently work with software developers, device manufacturers and other ecosystem partners.

For instance, on 19 September 2023, Honda Motor Co. announced a strategic collaboration deal with Taiwan Semiconductor Manufacturing Co. The collaboration aims to boost Honda's position in the market for EVs and advance automotive semiconductor technologies. Honda will collaborate closely with TSMC, a top semiconductor foundry, to create specialized chips made just for EVs. The deal is for manufacturing the integrated circuits.

Compatibility and Overheating of the Device

ICs have a finite physical size and as electronic devices become smaller and more compact, there are constraints on how many components can be integrated onto a single chip. ICs generate heat when in operation and high-power ICs may require additional cooling mechanisms. Excessive power consumption can limit battery life in portable devices. ICs can contain billions of transistors, there is a practical limit to how complex an individual chip can be designed and manufactured. Extremely complex ICs may be difficult and expensive to produce.

The process of designing and manufacturing ICs requires significant investment in fabrication facilities and equipment and this cost can be a barrier to entry for smaller companies and startups. As ICs become more powerful, managing heat dissipation becomes a challenge. Overheating can lead to reduced performance and decreased lifespan. Digital ICs excel at processing and storing binary data, they have limitations in analog signal processing. Specialized analog ICs are often required for applications like audio and radio frequency (RF) circuits.

Segment Analysis

The global integrated circuits market is segmented based on type, product, application, end-user and region.

Adoption of Digital IC Increases the Growth of the Market

During the forecast period 2023-2030, digital ICs are estimated to account for about 1/3rd of the global integrated circuits market. Digital ICs are integral to emerging technologies such as quantum computing, edge computing and neuromorphic computing and these technologies open new avenues for digital IC innovation and growth. Collaborating with partners in different regions or industries can help digital IC manufacturers expand their market reach. Joint ventures or partnerships can open doors to new customer segments and applications.

More compact, energy-efficient and potent digital ICs may now be produced because of continuous advances in semiconductor manufacturing methods, including lower nodes. For instance, in December 2021, Taiwan Semiconductor Manufacturing Company declared a collaboration with Sony in December 2021, with the two companies investing US$ 7 billion to develop a chip manufacturing facility in Japan. The advancements will raise Digital IC production and market growth.

Geographical Penetration

Rising Consumption of Semiconductors in Asia-Pacific

Asia-Pacific is the fastest as well as dominant region in the global integrated circuits market covering more than 1/3rd of the market. Due to the ongoing movement of diversified electronic equipment to China, the consumption of semiconductor parts in China, South Korea and Japan is fast expanding in comparison to other nations.

Furthermore, the largest sector of China's Integrated Circuits industry, IC design, has evolved from a focus on low-margin consumer applications to include advanced communication and computing semiconductors across growth markets such as automotive, the Internet of Things (IoT), crypto mining and artificial intelligence (AI).

For example, in August 2021, SiEn (Qingdao) Integrated Circuits Co, a foundry, began production of 8-inch silicon wafers and tested a new 12-inch production line in Qingdao. Furthermore, Semiconductor Manufacturing International Corp (SMIC) announced a US$ 8.87 billion investment in the construction of a chip manufacturing plant in Shanghai in September 2021. The company's strategy has been centered on integrated circuit foundry and technology services at process nodes of 28 nanometers and above.

Competitive Landscape

The major global players in the market include Samsung, Intel Corporation, Qualcomm Technologies, Inc., Texas Instruments, SK Hynix, NVIDIA, Avago Technologies, Micron Technology, Inc., AMI Semiconductor and Toshiba Electronic Devices & Storage Corporation.

COVID-19 Impact Analysis

The IC industry which heavily relies on global supply chains for raw materials, equipment and manufacturing. Many IC manufacturers faced challenges in sourcing materials and components, causing delays in chip manufacturing. To curb the spread of the virus, many semiconductor manufacturing facilities had to shut down or operate at reduced capacity.

The pandemic also led to increased demand for certain types of ICs. With the shift to remote work and online activities, there was a surge in demand for laptops, tablets and other devices, driving the need for ICs used in these products. As there was a decrease in demand for ICs used in industries hit hardest by the pandemic, such as automotive. As car manufacturing slowed down, the demand for automotive ICs decreased.

The pandemic disrupted the workforce, leading to labor shortages in some semiconductor manufacturing plants and this further impacted production capacity. The pandemic accelerated the digital transformation in various industries, including healthcare, e-commerce and remote work and this led to increased demand for ICs used in data centers, networking equipment and telemedicine devices.

AI Impact

AI algorithms, particularly machine learning and neural networks, are being used to optimize the design of ICs. AI can explore a vast design space to find configurations that meet specific performance and power requirements. Electronic Design Automation (EDA) tools are incorporating AI to enhance their capabilities. AI-driven EDA tools can automate many aspects of the design process, speeding up chip development.

AI is helping design ICs that are more power-efficient and this is critical for mobile devices and IoT applications where battery life is a concern. AI is used for fault detection and quality control during IC manufacturing. It can identify defects in chips more accurately and quickly than manual inspection. AI-driven testing methods can quickly validate IC designs, ensuring that they meet specifications and are free from defects.

For instance, on 21 September 2023, Intel's Innovation 2023 focused on accelerating the convergence of AI and security. Intel adapts to use AI to enhance security in various fields. Massive volumes of data may be analyzed in real-time by AI algorithms, making it possible to more quickly identify and address security issues. Intel also plans to develop specific integrated circuits which will lead to a reduction of millions of software.

Russia- Ukraine War Impact

Ukraine is home to several semiconductor and electronic component manufacturers. The war could disrupt the supply of critical components and materials needed for IC production and this includes items like rare earth minerals, which are essential for manufacturing semiconductors. The conflict may force semiconductor manufacturing plants in Ukraine to suspend operations or operate at reduced capacity due to safety concerns and infrastructure damage, this can disrupt the global supply chain.

Disruptions in the supply chain which leads to shortages of ICs and related electronic components and this can affect various industries, including consumer electronics, automotive and telecommunications, which rely heavily on ICs. Shortages and supply chain disruptions often lead to price volatility. Prices of certain ICs may increase due to high demand and limited supply affecting production costs for various products.

By Type
● Digital IC
● Analog IC
● Mixed-Signal IC

By Product
● General-Purpose IC
● Application-Specific IC

By Application
● Standard Computers
● Cell Phones
● Tablets
● Set Top Box
● Gaming Consoles

By End-User
● Consumer Electronics
● Automotive
● IT & Telecommunications
● Manufacturing and Automation
● Others

By Region
● North America

U.S.

Canada

Mexico
● Europe

Germany

UK

France

Italy

Russia

Rest of Europe
● South America

Brazil

Argentina

Rest of South America
● Asia-Pacific

China

India

Japan

Australia

Rest of Asia-Pacific
● Middle East and Africa

Key Developments
● In August 2023, Analog Devices completed its acquisition of Maxim Integrated Products, Inc and this acquisition strengthened ADI's position as a high-performance analog semiconductor company, with pro forma trailing twelve-month revenue of over US$ 9 billion, leading margins and significant free cash flow.
● In March 2022, Micross Components, Inc. announced an exclusive partnership with Apogee Semiconductor, a leader in Radiation-Hardened-by-Design semiconductors, using the patented TalRad (Transistor-Adjusted-Layout for Radiation) process. In this partnership, Micross becomes the global supplier of die and packaged devices utilizing Apogee Semiconductor technology.
● In March 2022, Toshiba expanded its lineup of stepping motor driver ICs with the release of the ""TB67S549FTG,"" a small-package stepping motor driver IC with built-in constant-current control that doesn't require external circuit components and this driver is suitable for industrial equipment such as office automation and financial equipment and helps save space on circuit boards.

Why Purchase the Report?
● To visualize the global integrated circuits market segmentation based on type, product, application, end-user and region, as well as understand key commercial assets and players.
● Identify commercial opportunities by analyzing trends and co-development.
● Excel data sheet with numerous data points of integrated circuits market-level with all segments.
● PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.
● Product mapping available as excel consisting of key products of all the major players.

The global integrated circuits market report would provide approximately 69 tables, 70 figures and 201 pages.

Target Audience 2023
• Manufacturers/ Buyers
• Industry Investors/Investment Bankers
• Research Professionals
• Emerging Companies