Worldwide semiconductor revenue grew 5.4 percent to $442 billion in 2020, said a new report from International Data Corporation (IDC).
The market report on the semiconductor industry indicates that for semiconductors used in computing systems, such as PCs and servers, outpaced the overall semiconductor market, growing 10.9 percent to $152 billion in 2020.
The semiconductor market will reach $476 billion in 2021, a 7.7 percent year-over-year growth rate as the various Covid-19 vaccines are disseminated and economies begin to open and gradually recover, according to a forecast by IDC.
“There are specific markets that remain on an upward trajectory and are essential to the recovery this year, including 5G, cloud, intelligent edge, and the dedicated foundry industry,” Mario Morales, program vice president, Enabling Technologies and Semiconductors at IDC, said.
Smartphones were the second largest demand driver for 2020 with the growth in 5G smartphones accelerating significantly.
Healthy competition for lower cost 5G SoCs (system on chips) resulted in 5G phones being sold at a wide variety of price ranges to reach a broader set of consumers.
Mobile phone shipments fell by more than 5 percent in 2020. Phone semiconductor revenues will have grown by about 3 percent due to a shift to higher ASP 5G semiconductors, more memory, sensors, and RF support for more spectrum bands, said Phil Solis, research director for Connectivity and Smartphone Semiconductors.
2021 will be an especially important year for semiconductor vendors as 5G phones capture 30 percent of all mobile phone shipments while semiconductors for 5G phones will capture nearly 54 percent of the revenue in the segment.
IDC forecasts mobile phone semiconductor revenues will grow by 11.4 percent in 2021 to $128 billion.
The automotive and industrial semiconductor markets were impacted by Covid-19, which created sales disruption and manufacturing disruptions, while trade policy impacted supply chains throughout the year.