Nvidia may become the dominant IC design house: TrendForce

First-quarter revenue of the top ten IC design houses rose 0.1 percent QoQ to $33.86 billion, TrendForce reports.
Top IC design housesChanges in ranking included Cirrus Logic slipping from the top ten as well as the ninth and tenth positions being replaced by WillSemi and MPS, respectively. The rest of the rankings remained unchanged.

The smartphone supply continues to grapple with overstock, but AI applications are entering a period of rapid growth.

Qualcomm’s Q1 revenue increased by 0.6 percent, cementing its position at the top of the pack with a market share of 23.5 percent.

Qualcomm’s uptick in its revenue was due to the launch of its latest flagship chip, the Snapdragon 8Gen2. Qualcomm saw 6.1 percent in QoQ growth in its smartphone business, which effectively offset the downturn from its automotive and IoT sectors.

Broadcom’s revenue decline to $6.91 billion as it faced challenges stemming from the waning dividends of its product migration, coupled with a slowdown in demand for server storage and a seasonal downturn in the wireless sector.

Nvidia experienced growth this quarter, fueled by an explosive surge in demand for generative AI and cloud computing, alongside the introduction of the RTX 40 series. The company’s revenue from gaming and data centers saw a quarterly increase of 20 percent and 10 percent, respectively. This propelled Nvidia’s Q1 revenue by 13.5 percent, reaching $6.73 billion and elevating its market share to close to 20 percent.

AMD’s Q1 revenue fell 4.4 percent to $5.35 billion as it faced several challenges, including inventory adjustments by some CSPs, weakened corporate expenditure due to macroeconomic influences, and a range of negative factors such as inventory modifications and an off-peak consumption period among PC-related clients. These led to a 21.8 percent and 18.2 percent QoQ decline in the revenue of its data center and client divisions, respectively.

MediaTek’s revenue in 1Q23 fell 8.8 percent to $3.15 billion. MediaTek — during a lull in smartphone production and amid ongoing inventory adjustments in power management ICs — witnessed a 20 percent and 13 percent decline in its smartphone and power management IC sectors, respectively. MediaTek’s market share dropped from 10.2 percent last quarter to 9.3 percent.

Marvell’s Q1 revenue across all platforms was significantly impacted by adjustments in customer and channel inventories, leading to a QoQ decline of 7.1 percent and revenue falling to $1.35 billion. This dip occurred despite steady demand from servers, CSPs, and 5G-related wireless services. When taking a look at variations in revenue across all platform, both consumer products and data centers suffered over a 10 percent decline. Seasonal factors were to blame for consumer products; for data centers, it was due to a slowdown in demand from on-premise enterprise businesses.

Novatek’s SoC and panel driver IC businesses experienced a QoQ growth of 24 percent and 2 percent, respectively, driven by the restocking of TV-related components. This led to a 10.7 percent increase in the company’s Q1 revenue, bringing it up to US$791 million. Novatek maintained its seventh position with a market share of 2.3 percent.

Cirrus Logic, with over 80 percent of its revenue dependent on Apple alone, experienced a significant reduction in earnings due to factors such as a waning “new product” boost from the iPhone and a seasonal dip in sales. Consequently, Cirrus Logic dropped out of the top ten.

The ninth and tenth positions were subsequently filled by WillSemi and power management IC giant MPS. WillSemi reported a Q1 revenue of US$539 million, marking a QoQ growth of 1.3 percent. MPS, however, witnessed a 1.9 percent QoQ decline, with its Q1 revenue standing at US$451 million.

The global deployment of AI chips — championed by CSPs and businesses, and stimulated by the rising popularity of generative AI technologies like ChatGPT — is expected to trigger a swift revenue surge. Nvidia may rise to become the dominant IC design house in 2Q23.