Major memory vendors that performed strongly in 2018 include SK hynix -driven by DRAM, and Microchip Technology due to its acquisition of Microsemi
The recent studies conducted by Gartner Inc.reveals that the semiconductor revenue reached $476.7 billion in 2018 globally with a 13.4 per cent increase from 2017.
Memory market contributed a 34.8 per cent of total semiconductor revenue, up from 31 per cent in 2017 clearly indicates that Memory emerged as the largest semiconductor category.
Andrew Norwood, vice president, analyst at Gartner commented that the largest semiconductor supplier, Samsung Electronics, increased its lead as the No. 1 vendor due to the booming DRAM market.He also predicted that 2019 will be a very different market from the previous two years. Memory has already entered a downturn, there is the looming trade war between the US and China, and mounting uncertainty about the global economy.
As per the survey,the combined revenue of the top 25 semiconductor vendors increased by 16.3 per cent during 2018 and accounted for 79.3 per cent of the market, outperforming the rest of the market, which saw a milder 3.6 per cent revenue increase. This is due to the concentration of the memory vendors in the top-25 ranking.
Top four vendors in 2017 retained their ranking in 2018
Intel’s semiconductor revenue grew by 12.2 per cent compared with 2017, driven by a combination of unit and average selling price (ASP) growth. Major memory vendors that performed strongly in 2018 include SK hynix driven by DRAM, and Microchip Technology due to its acquisition of Microsemi.
The top four vendors in 2017 retained their ranking in 2018 (see the Table below).
Memory – highest-performing device category
In terms of semiconductor devices, memory was simultaneously the largest (35 per cent) and highest-performing device category for 2018 with 27.2 per cent revenue growth. This was driven by increases in ASP for DRAM for much of the year except for the fourth quarter of 2018.
The second-largest semiconductor category, application-specific-standard products, saw limited growth of 5.1 per cent due to a stalling smartphone and tablet market that continues to decline. Leading vendors in this segment including Qualcomm and MediaTek, are aggressively expanding into adjacent markets with stronger prospects for growth, including automotive and IoT applications.
Merger and acquisition
Merger and acquisition activity in 2018 was more significant for the deals that did not happen than the deals that did. Broadcom’s takeover attempt of Qualcomm failed as the US government stepped in, and Qualcomm’s bid to secure NXP became embroiled in the ongoing trade war with China. Completed deals included Toshiba spinning off its NAND business into Toshiba Memory in June 2018 and Microchip’s May 2018 acquisition of Microsemi.
