After three years of seeing its dominant position in the global semiconductor market whittled away by aggressive competition from Samsung Electronics, Intel is set to reverse the trend in 2011, with a combination of strong sales and an acquisition allowing the company to rebuild its margin of market leadership, according to IHS iSuppli.
Intel in 2011 is set to sell US$49.7 billion worth of semiconductors, up 23% from US$40.4 billion in 2010, said IHS. This will allow the US-based vendor to outgrow the overall semiconductor market and boost its share of the market to 15.9%, up from 13.2% in 2010.
With this strong performance, Intel increased its lead over second-ranked Samsung to 6.5pp, IHS indicated. The increase ended a three-year period that saw Samsung close the gap with Intel from a 6.5pp margin in 2008 to a 3.9pp difference in 2010.
"In a challenging year for the semiconductor market, Intel achieved success on all fronts, expanding its core microprocessor and memory businesses, while also capitalizing on a major acquisition," said analyst Dale Ford. "This allowed the company to outgrow the market and expand its lead over its closest competitors, defying the impact of weak economic conditions and catastrophic natural disasters in Japan and Thailand."
Intel derives most of its semiconductor revenues from selling microprocessors (MPU) and NAND flash memory, two of the hottest segments of the chip industry in 2011, IHS said. These areas are set to generate double-digit revenue growth of between 15-20% this year.
Meanwhile, Intel's revenues were boosted by its acquisition of Infineon Technologies' wireless solutions business, IHS noted.
Samsung, the world's leading supplier of NAND, also is benefiting from the growth of this memory segment in 2011, IHS indicated. Furthermore, the South Korea-based electronics giant is posting strong sales growth in other product lines like mobile applications processors, CMOS image sensors and display drivers.
However, Samsung also is the leading supplier of DRAM, which represents a weak segment of the global semiconductor market, with a gut-wrenching 27% decline in total market revenues expected this year, IHS pointed out. Combined with poor market conditions in other memory segments, this will limit Samsung's revenue growth to 3% in 2011, far less than Intel's growth, IHS said.
Intel is not alone in engaging a major purchase this year, with merger and acquisition activity playing a big role in influencing the growth and market share rankings of five of the Top 20 semiconductor suppliers in 2011, according to IHS. No. 3 Texas Instruments in 2011 purchased fellow US supplier National Semiconductor, helping it to rise one rank to supplant Japan's Toshiba as the world's third-largest chip supplier, IHS observed.
Meanwhile, Qualcomm will see its semiconductor revenues jump 39.9% in 2011, courtesy of an extra boost from its acquisition of Atheros Communications, IHS indicated. This will propel Qualcomm up the rankings by three spots, rising to No. 6, up from ninth place in 2010.
The biggest jump in rank among in 2011 is expected to be at ON Semiconductor, which will achieve growth of nearly 50%, IHS said. ON's acquisition of Sanyo Semiconductor from Panasonic will boost it seven places to No. 19 in the rankings. Conversely, the sale of Sanyo will contribute to Panasonic's 32% plunge in revenues, causing it to fall by five positions to No. 20.
Based on the results of preliminary 2011 market share research from IHS, the forecast for global semiconductor market growth has been raised slightly to 1.9%, up from the previous outlook of a 1.2% increase.
"In light of the daunting economic challenges and major supply chain disruptions due to natural disasters, it is a real victory for the semiconductor market to still achieve any growth at all in 2011," Ford noted. "Revenue in 2011 is forecast to increase by US$5.8 billion to reach US$312.8 billion, up from US$307 billion in 2010."
To be sure, the Japan disaster in the first quarter of the year played a significant role in shaping the pattern of growth in 2011, IHS said. But while the negative impact on the supply chain in the second quarter caused revenues to decline, the third-quarter rebound pushed growth above 4%, well above prevailing expectations. Still, extremely weak economic conditions are expected to exert a serious drag on the semiconductor industry in 2012 and result in stagnant growth in the low single-digit range. Any type of meaningful rebound in revenue growth is not expected to take place until 2013, IHS said.
| HIS iSuppli: WW ranking of Top 20 suppliers of semiconductors by revenues (US$m) | |||||||
| 2010 | 2011 | Company | 2010 | 2011 | Y/Y | Percent | Cumulative |
| 1 | 1 | Intel | 40,394 | 49,685 | 23.0% | 15.9% | 15.9% |
| 2 | 2 | Samsung Electronics | 28,380 | 29,242 | 3.0% | 9.3% | 25.2% |
| 4 | 3 | Texas Instruments | 12,994 | 14,081 | 8.4% | 4.5% | 29.7% |
| 3 | 4 | Toshiba | 13,010 | 13,362 | 2.7% | 4.3% | 34.0% |
| 5 | 5 | Renesas Electronics | 11,893 | 11,153 | (6.2%) | 3.6% | 37.6% |
| 9 | 6 | Qualcomm | 7,204 | 10,080 | 39.9% | 3.2% | 40.8% |
| 7 | 7 | STMicroelectronics | 10,346 | 9,792 | (5.4%) | 3.1% | 43.9% |
| 6 | 8 | Hynix | 10,380 | 8,911 | (14.2%) | 2.8% | 46.8% |
| 8 | 9 | Micron Technology | 8,876 | 7,344 | (17.3%) | 2.3% | 49.1% |
| 10 | 10 | Broadcom | 6,682 | 7,153 | 7.0% | 2.3% | 51.4% |
| 12 | 11 | AMD | 6,345 | 6,483 | 2.2% | 2.1% | 53.5% |
| 13 | 12 | Infineon Technologies | 6,319 | 5,403 | (14.5%) | 1.7% | 55.2% |
| 14 | 13 | Sony | 5,224 | 5,153 | (1.4%) | 1.6% | 56.9% |
| 16 | 14 | Freescale Semiconductor | 4,357 | 4,465 | 2.5% | 1.4% | 58.3% |
| 11 | 15 | Elpida Memory | 6,446 | 3,854 | (40.2%) | 1.2% | 59.5% |
| 17 | 16 | NXP | 4,028 | 3,838 | (4.7%) | 1.2% | 60.7% |
| 20 | 17 | Nvidia | 3,196 | 3,672 | 14.9% | 1.2% | 61.9% |
| 18 | 18 | Marvell Technology | 3,606 | 3,448 | (4.4%) | 1.1% | 63.0% |
| 26 | 19 | ON Semiconductor | 2,291 | 3,423 | 49.4% | 1.1% | 64.1% |
| 15 | 20 | Panasonic | 4,946 | 3,365 | (32.0%) | 1.1% | 65.2% |
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| Top 20 | 196,917 | 203,907 | 3.5% | 65.2% |
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| Others | 110,110 | 108,882 | (1.1%) | 34.8% |
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| Total | 307,027 | 312,789 | 1.9% | 100.0% |
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Source: IHS, compiled by Digitimes, December 2011
| HIS iSuppli: Semiconductor revenues by company headquarters location, 2011 (US$m) | |||||||
| 2010 | 2011 | Company HQ | 2010 | 2011 | Y/Y | Percent | Cumulative |
| 1 | 1 | Americas | 146,817 | 159,336 | 8.5% | 50.9% | 50.9% |
| 3 | 2 | Asia-Pacific | 69,079 | 66,955 | (3.1%) | 21.4% | 72.3% |
| 2 | 3 | Japan | 62,962 | 59,251 | (5.9%) | 18.9% | 91.3% |
| 4 | 4 | EMEA | 28,169 | 27,247 | (3.3%) | 8.7% | 100.0% |
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| Total: | 307,027 | 312,789 | 1.9% | 100.0% |
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Source: IHS, compiled by Digitimes, December 2011
Article translated by Jessie Shen
