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Apr 13 2021

Semiconductor units to exceed one trillion dollars again in 2021

Total semiconductor unit shipments, which include integrated circuits as well as optoelectronics, sensor/actuator, and discrete (O-S-D) devices, are expected to rise 13% in 2021 to 1,135.3 billion (1.1353 trillion) units, setting a new all-time annual record, according to data presented in the 2021 edition of IC Insights' McClean Report—A Complete Analysis and Forecast of the Integrated Circuit Industry.

 

It would be the third time in a calendar year that semiconductor units surpassed one trillion units, with the first occurring in 2018.

 

The 13% increase to 1,135.3 billion semiconductor units follows a 3% increase in 2020, when the Covid-19 pandemic wreaked havoc on many sectors of the economy. From 1978, when 32.6 billion units were shipped, to 2021, the compound annual growth rate (CAGR) for semiconductor units is expected to be 8.6 percent - an impressive 43-year annual growth rate, despite the fact that growth rates for many key semiconductor applications, such as PCs and cellphones, have slowed. The high CAGR also shows that new market drivers continue to emerge, fueling demand for more semiconductors.

Between 2004 and 2007, semiconductor shipments surpassed the 400-, 500-, and 600-billion-unit thresholds before the global financial meltdown caused a precipitous drop in shipments in 2008 and 2009. Unit growth rebounded sharply in 2010, with a 25% increase, and the number of devices sold surpassed 700 billion that year. Another strong increase (12 percent growth) in 2017 pushed semiconductor unit shipments past the 900-billion mark before surpassing the one trillion mark in 2018.

 

The largest annual unit growth rate over the 43-year period shown above was 34% in 1984, with the second-highest growth rate of 25% in 2010. In comparison, the largest annual decline was 19% in 2001, following the dot-com bust. The global financial meltdown and subsequent recession caused semiconductor shipments to fall in both 2008 and 2009, marking the first time that unit shipment declines occurred in consecutive years.

 

In 2021, total semiconductor shipments are expected to remain heavily weighted toward O-S-D devices. O-S-D devices are expected to account for 67% of total semiconductor shipments, compared to 33% for ICs. Discrete devices are expected to account for 38 percent of semiconductor shipments, followed by optoelectronics (26 percent) and analog IC devices (18 percent ).

 

Components aimed at network and cloud computing systems, contactless (touchless) systems, automotive electronics including autonomous systems, and devices critical to the rollout of 5G technology applications are expected to see some of the highest unit growth in 2021.

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