The size of the semiconductor market is projected to decline 11.2 percent in 2023 to $532 billion from $599.6 billion in 2022, according to the latest forecast from Gartner.
“As economic headwinds persist, weak end-market electronics demand is spreading from consumers to businesses, creating an uncertain investment environment. An oversupply of chips which is elevating inventories and reducing chip prices, is accelerating the decline of the semiconductor market,” said Richard Gordon, Practice Vice President at Gartner.

The memory industry will face pressure on average selling prices (ASPs) in 2023 due to overcapacity and excess inventory. The memory market is projected to decline 35.5 percent in 2023 to $92.3 billion. The memory market is projected to grow at 70 percent in 2024.

DRAM market will witness significant oversupply for most of 2023 due to weak end-equipment demand and high inventory levels despite flat bit production by DRAM vendors. DRAM revenue will decline 39.4 percent in 2023 to $47.6 billion. The DRAM market revenue is set to increase 86.8 percent in 2024 as pricing rebounds.

NAND revenue is projected to decline 32.9 percent to $38.9 billion in 2023. In 2024, NAND revenue is projected to increase 60.7 percent due to a deep supply shortage.

The PC, tablet and smartphone semiconductor markets will represent 31 percent of semiconductor revenue in 2023 and total $167.6 billion.

Both the automotive and industrial, military/civil aerospace semiconductor markets will achieve growth. The automotive semiconductor market is forecast to grow 13.8 percent, reaching $76.9 billion in 2023.

In the future, there will be many more but smaller end markets. End markets will be more fragmented, with pockets of growth coming from multiple different sectors in the automotive, industrial, IoT and military/aerospace sectors.