Worldwide semiconductor revenue remains on track to reach $338 billion in 2014, a 7.2 percent increase from 2013, and up from the previous quarter’s forecast of 6.7 percent growth. According to Gartner analysts, DRAM leads all semiconductors in 2014 with revenue growth of 26.3 percent – and is expected to reach all-time revenue high of $44.1 billion for the year.
“The semiconductor market actually plateaued at about $300B to $310B, post 2009 recession. So I would posit that we are in the midst of a real breakout,” Loren Shalinsky, a Strategic Development Director at Rambus, explained.
“More specifically, Gartner previously predicted the semiconductor market would increase to $336B for 2014. It appears as if that forecast is turning out to be quite accurate.”
So why is DRAM leading all semiconductors in 2014? Firstly, notes Shalinsky, the demand for DRAM has only increased over the years. To be sure, DRAM is packed into an increasingly wide range of devices – such as smartphones, tablets and wearables – in addition to traditional PCs and laptops.
“Quite simply, we are witnessing the growth of mobile, particularly when it comes to smartphones. For every smartphone sold, there is about $100 of semiconductor materials, including the value of the DRAM,” said Shalinsky.
“As expected, the number of smartphones hitting the streets has been steadily increasing – touching 1 billion in 2014 – up from approximately 300 million in 2010. Meaning, independent of other markets, the value of semiconductors in smartphones has risen by about $70B since 2010.”
More specifically, DRAM prices that fell 48% in 2011 and 32% in 2012 were relatively stable in 2013 and 2014.
“Growth in demand coupled with stable prices means that DRAM revenue will increase 26% in 2014, after already rising ~30% from 2012 to 2013,” he concluded.
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