4G smartphones will spur rapid rise in semiconductor revenues
Demand for semiconductors in smartphones and tablets is expected to offset weak semiconductor demand in other segments and push semiconductor revenues up 4.9 percent to reach $319 billion this year, according to the latest IDC stats.
The semiconductor market is predicted to post a 4.1 percent compound annual growth rate through 2016, IDC forecasts.
"Semiconductors for smartphones will see healthy revenue growth as appetite for data, multimedia processing, and multitasking will drive high-end smartphone demand in developed countries, while an ongoing transition to 3G networks will accelerate smartphone adoption in developing regions," said Mali Venkatesan, research manager for semiconductors at IDC.
Venkatesan predicts that 4G smartphones will fuel an impressive 140 percent annual revenue growth rate in semiconductor revenues in 2013 and a compound annual growth rate of 103 percent through 2016.
In the United States, 4G smartphones, tablets and eReaders, as well as network infrastructure and set-top box deployments, will result in a healthy semiconductor growth rate over the next five years.
At the same time, weakness in PC demand, dynamic random-access memory and memory price deterioration, along with semiconductor inventory rationalization and global economic turmoil, are predicted to dampen global semiconductor demand this year.
The IDC predictions jive with Gartner stats released last month. Gartner found that smartphone demand was the strongest driver of semiconductor revenues in 2012, while other segments, such as PCs and DRAM, experienced sluggish growth.