Semiconductor Revenue Grew 22.2% in 2017; Samsung Takes No. 1 Position

Semiconductor Revenue Grew 22.2% in 2017; Samsung Takes No. 1 Position

Foto: Shutterstock

Worldwide semiconductor revenue totalled $419.7 billion in 2017, a 22.2 percent increase from 2016, according to preliminary results by Gartner. Undersupply helped drive 64 percent revenue growth in the memory market, which accounted for 31 percent of total semiconductor revenue in 2017.

"The largest memory supplier, Samsung Electronics, gained the most market share and took the No. 1 position from Intel, the first time Intel has been toppled since 1992," said Andrew Norwood, research vice president at Gartner. "Memory accounted for more than two-thirds of all semiconductor revenue growth in 2017, and became the largest semiconductor category."

The key driver behind the booming memory revenue was higher prices due to a supply shortage. NAND flash prices increased year over year for the first time ever, up 17 percent, while DRAM prices rose 44 percent. Equipment companies could not absorb these price increases so passed them onto consumers, making everything from PCs to smartphones more expensive in 2017. Other major memory vendors, including SK Hynix and Micron Technology, also performed strongly in 2017 and rose in the rankings.

2017 Rank

2016 Rank

Vendor

2017 Revenue

2017 Market Share (%)

2016 Revenue

2016-2017 Growth (%)

1

2

Samsung

61,215

14.6

40,104

52.6

2

1

Intel

57,712

13.8

54,091

6.7

3

4

SK Hynix

26,309

6.3

14,700

79.0

4

6

Micron

23,062

5.5

12,950

78.1

5

3

Qualcomm

17,063

4.1

15,415

10.7

6

5

Broadcom

15,490

3.7

13,223

17.1

7

7

Texas Instruments

13,806

3.3

11,901

16.0

8

8

Toshiba

12,813

3.1

9,918

29.2

9

17

Western Digital

9,181

2.2

4,170

120.2

10

9

NXP

8,651

2.1

9,306

-7.0

 

 

Others

174,418

41.6

157,736

10.6

 

 

Total Market

419,720

100.0

343,514

22.2

Second-placed Intel grew its revenue 6.7 percent in 2017, driven by 6 percent growth in data center processor revenue due to demand from cloud and communications service providers. Intel’s PC processor revenue grew more slowly at 1.9 percent, but average PC prices are on the rise again after years of decline following the market’s shift from traditional desktops toward two-in-one and ultramobile devices.

The current rankings may not last long, however, "Samsung’s lead is literally built on sand, in the form of memory silicon," said Norwood. "Memory pricing will weaken in 2018, initially for NAND flash and then DRAM in 2019 as China increases its memory production capacity. We then expect Samsung to lose a lot of the revenue gains it has made."

2017 was a relatively quiet year for mergers and acquisitions. Qualcomm’s acquisition of NXP was one big deal that was expected to close in 2017, but did not. Qualcomm still plans to complete the deal in 2018, but this has now been complicated by Broadcom’s attempted takeover of Qualcomm.

"The combined revenues of Broadcom, Qualcomm and NXP were $41.2 billion in 2017, a total beaten only by Samsung and Intel," said Norwood. "If Broadcom can finalize this double acquisition and Samsung’s memory revenue falls as forecast, then Samsung could slip to third place during the next memory downturn in 2019."

More from category

Smart Grids Will Save City Dwellers $14bn in Energy Costs by 2022

Smart Grids Will Save City Dwellers $14bn in Energy Costs by 2022

16 Jan 2018 comment

New data from Juniper Research has found that the development of smart grids linked to smart cities will result in citizens saving $14 billion per annum in energy bills by 2022.

Gartner: AI Is a Game Changer for Personal Devices

Gartner: AI Is a Game Changer for Personal Devices

16 Jan 2018 comment

Emotion artificial intelligence (AI) systems are becoming so sophisticated that Gartner predicts that by 2022, personal devices will know more about an individual's emotional state than his or her own family.

Gartner: PC Shipments Declined 2% in 4Q17 and 2.8% for the Year

Gartner: PC Shipments Declined 2% in 4Q17 and 2.8% for the Year

15 Jan 2018 comment

As we have mentioned earlier, it is still unclear whether PC shipments grew or fell in the last quarter of 2017. Gartner reports, also in a preliminary analysis, that PC shipments totaled 71.6 million units in the fourth quarter of 2017, a 2 percent decline from the same quarter of 2016.