Worldwide semiconductor sales are forecast to drop 5% in 2023 after hitting a record high in 2022, according to IC Insights.
After soaring 25% to US$614.7 billion in 2021, worldwide semiconductor sales are expected to increase 3% to a new record sales level of US$636.0 billion this year, said IC Insights.
However, adverse conditions that stunted semiconductor sales in the second half of 2022 are expected to persist through the first half of next year, IC Insights indicated. A global economy struggling through the recession, soft demand for new enterprise and personal computers and smartphones, elevated chip inventory levels, and continued weakness in the memory IC market are expected to reduce total semiconductor sales by 5% next year. Total IC sales are forecast to decrease 6% while combined sales of O-S-D (optoelectronics, sensors and actuators, and discretes) devices are forecast to nudge slightly higher.
Following the cyclical down year in 2023, IC Insights forecasts semiconductor sales will rebound with three years of much more robust growth. By the end of the forecast period in 2026, semiconductor sales are forecast to climb to US$843.6 billion, representing a CAGR of 6.5%.
In 2022, four major semiconductor product categories are expected to post solid double-digit sales gains, IC Insights said. The microcomponents and optoelectronics segments are expected to grow by single-digit amounts. Only the highly cyclical memory market is forecast to post a 17% decline, weighing down overall IC and semiconductor market growth this year.
In a separate report, IC Insights revised its 2022 worldwide semiconductor capital spending forecast to show a 19% increase this year to US$181.7 billion. The revision represents a decrease from US$190.4 billion and 24% growth that was initially forecast. Still, the revised capex forecast will amount to a new record high level of spending.
Semiconductor industry capital spending grew 10% in 2020 and surged by 35% in 2021. If industry capital spending rises as forecast by 19% this year, it will mark the first three-year period of double-digit capex increases in the semiconductor industry since 1993-1995, IC Insights said. However, a weak memory market and US sanctions on China semiconductor producers may lead to a 19% decline in semiconductor capital spending in 2023, according to the market researcher.