The global semiconductor industry is set for a significant boom in 2025, with a projected growth rate exceeding 15 percent, according to IDC.
Major drivers include the adoption of artificial intelligence (AI) and high-performance computing (HPC) applications across sectors, from cloud data centers to consumer electronics.
AI-driven innovations are fueling demand for high-end logic chips and high bandwidth memory (HBM), with the memory market expected to grow over 24 percent.
“As AI continues to drive demand for high-end logic process chips and increases the penetration rate of high-priced HBM, the overall semiconductor market is expected to have double-digit growth in 2025,” Galen Zeng, Senior Research Manager at IDC Asia Pacific, said in the report.
Non-memory segments are forecasted to see a 13 percent rise due to increased usage in AI servers, high-end mobile devices, and advanced WiFi solutions.
Asia-Pacific region’s integrated circuit (IC) design market is projected to expand by 15 percent, with applications spanning smartphones, IoT devices, and industrial control systems.
Taiwan Semiconductor Manufacturing Company (TSMC) is expected to further solidify its dominance, with a market share reaching 66 percent in traditional foundry operations by 2025. Its advanced node manufacturing will remain a pivotal growth area.
Global investments in sub-20nm technology are accelerating, with TSMC, Samsung, and Intel advancing their production capabilities for AI and high-performance applications.
Following a period of oversupply, demand for mature node technologies (22nm-500nm) in consumer electronics, automotive, and industrial control is set to rebound, driving higher capacity utilization rates.
The year 2025 will mark critical developments in 2nm chip technology, with leading manufacturers achieving mass production and optimizing yields for AI accelerators and smartphone applications.
Geopolitical factors are reshaping the semiconductor packaging landscape, benefiting manufacturers in China and Taiwan. Advanced techniques like CoWoS and FOPLP are set for exponential growth, with CoWoS production capacity doubling year-on-year.
While the sector anticipates double-digit growth, it faces challenges, including geopolitical tensions, fluctuating economic policies, and balancing supply-demand dynamics due to new capacity additions.
IDC’s report reflects the transformative role of AI and advanced manufacturing technologies in driving the semiconductor industry’s next growth phase. The sector’s ability to navigate complex global challenges will be pivotal in sustaining its upward trajectory.
Omdia report for Q3 2024
Global semiconductor revenues grew 8.5 percent quarter-over-quarter to $177.8 billion in Q3 2024, a 25 percent year-over-year increase from Q3 2023, Omdia report said.
AI-driven demand was the primary growth driver, with significant contributions from GPUs (NVIDIA) and high-bandwidth memory (SK Hynix).
For the first three quarters of 2024, cumulative semiconductor revenue reached $494 billion, marking a 26 percent increase compared to the same period in 2023.
NVIDIA held the top position in Q3 2024, achieving a 10.5 percent sequential revenue growth and capturing over 15 percent of the market share.
Semiconductor revenue is projected to grow by 4.5 percent to nearly $186 billion in Q4 2024, driven by demand in AI-focused segments.
Baburajan Kizhakedath
