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The Digital Integrated Circuit (IC) Market size is forecast to increase by USD 173.49 billion, at a CAGR of 8.55% between 2023 and 2028. Several governments across the world are framing policies including energy performance standards and energy performance certifications or labels coupled with general awareness programs to ensure environmental sustainability, reduced consumption of energy, and lower utility bills for consumers.
Digital transformation in industries including telecommunication, industrial, healthcare, and others is fuelling the growth of the global digital IC market. In addition, in the telecommunications industry, the introduction of fourth-generation (4G) and fifth-generation (5G) technology is allowing end-users to connect with high-speed Internet. The evolution in market research and growth has paved the way for advancements in microprocessor chips and magnitude comparators. Additionally, the surge in EVs (Electric Vehicles) is driving innovations in artificial intelligence (AI) and digital signal processor segment.
Market Forecast 2024-2028
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The logic ICs segment is estimated to witness significant growth during the forecast period. A logic IC can be referred to as a semiconductor device that carries out basic logical operations on one or more digital input signals. In addition, logic ICs are utilized in consumer electronics, telecommunication devices, automotive parts, and other industries.
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The logic ICs segment was the largest segment and was valued at USD 128.78 billion in 2018. Moreover, many end-users, designers, and manufacturers have been able to create incredibly innovative and phenomenal technology in digital electronics like state machines, controllers, and data processing circuits for a variety of applications where logic ICs are used. In addition, logic devices are a highly favored and preferred option by many end-users from several industries due to their lower power consumption, lower costs, and the integration of many advanced features that are not possible in most other alternatives. Hence, such factors are fuelling the growth of this segment which in turn drives the market growth during the forecast period.
Based on the end-user, the market has been segmented into computer, telecommunication, automotive, consumer electronics and others. The computer segment will account for the largest share of this segment. The computer segment comprises computing devices such as personal computers (PCs), laptops, and graphics controllers. In addition, the demand for computer devices such as PCs has been declining as more consumers are shifting to portable computing devices. Furthermore, with the emergence of the smart revolution, spurred by Industry 4.0, which focuses on the development of smart cities, smart grids, and smart homes, there is a large amount of data being generated. In addition, processing this large data has become a priority encoders, and this has led to an increase in the number of computing devices. Hence, such factors are fuelling the growth of this segment which in turn drives the market growth during the forecast period.
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APAC is estimated to contribute 64% to the growth by 2028. Technavio's analysts have provided extensive insight into the market forecasting, detailing the regional trends and drivers influencing the market's trajectory throughout the forecast period. The APAC region is expected to grow at a strong rate fuelled by the fast pace of industrialization in developing countries in the region and the increasing adoption of renewable energy and EVs in China, Japan, and India. Moreover, the demand for energy-efficient solutions, both in the industrial and consumer electronics sectors, is the other reason for the high share of the region in the global digital integrated circuit market. In addition, there are a few key countries, such as Taiwan, South Korea, Japan, and China, which contribute significantly to market demand as they are the base for most of the major semiconductor device manufacturers. Furthermore, the presence of end-user industries, especially those manufacturing consumer electronics and mobile devices, supports the demand for digital ICs in APAC. Hence, such factors are driving the market growth in APAC during the forecast period.
The Digital IC Market is being driven by the high demand for energy-efficient electronic products, necessitating advancements in miniaturization and low power consumption. A significant trend in this market is the growing initiatives for digital transformation, spurred by the integration of digital technologies such as Internet of Things (IoT), cloud computing, and big data across various industry verticals.
However, the industry faces challenges due to volatility in raw material prices, impacting manufacturing costs and profitability. With a focus on enhancing functionalities such as NOR, OR, AND functions and multiplexers within digital signal processors and microprocessor chips, the digital IC market caters to diverse applications spanning from smartphones and tablets to laptops and PCs. Technological developments in Gallium arsenide and innovations by companies like Semiconductor Manufacturing International Corp (SMIC) and PragmatIC Semiconductor further propel market growth, facilitating the integration of digital ICs in emerging sectors such as electric vehicles (EVs) and renewable energy, as well as advancing applications in artificial intelligence (AI).
Several governments across the world are framing policies including energy performance standards and energy performance certifications or labels coupled with general awareness programs to ensure environmental sustainability, reduced consumption of energy, and lower utility bills for consumers. In addition, these policies and the rise in the cost of energy have compelled electronic component manufacturers to take measures to develop energy-efficient products.
Moreover, the efficient use of energy is a crucial approach to achieving a more sustainable society by minimizing carbon emissions and reducing power consumption in applications like transportation, household appliances, household and commercial power, and industrial equipment. Furthermore, the electrical efficiency of products can reduce power bills by approximately one-fifth. This has led to increasing demand for electronic products, such as energy-efficient digital ICs. Hence, such factors are driving the market growth during the forecast period.
Digital transformation in industries including telecommunication, industrial, healthcare, and others is fuelling the growth of the global digital IC market. In addition, in the telecommunications industry, the introduction of fourth-generation (4G) and fifth-generation (5G) technology is allowing end-users to connect with high-speed Internet.
Moreover, the emergence of advanced Internet technologies such as high-speed broadband and voice-over-Internet Protocol (VoIP) on mobile phones has led to higher consumer preference for Internet services. In addition, the adoption of such Internet-based technologies provides various facilities, such as text messages, voice calls, video calls, and TV on smartphones using the Internet. Furthermore, this will enhance the demand for digital ICs in telecommunication equipment, such as enterprise network equipment and wireline network equipment, among others. Hence, such factors are driving the market growth during the forecast period.
The semiconductor industry is a highly fluctuating sector, which sees cyclical patterns that may witness a rise in profit margins and revenue, followed by a slump and retrenchments in the industry. In addition, this cyclical nature of the global semiconductor industry leads to the industry being highly volatile. Furthermore, some examples of downturns that affect the market drastically are excess production capacity, rapid obsolescence of products, and rapid price erosion in digital ICs.
Moreover, these high fluctuations can often lead to excess inventory levels in times of low demand as well as low inventory levels in times of high demand. In addition, with growing labor costs and political instability, several industries, such as mining, are facing a threat of raw material scarcity. Hence, such factors are negatively impacting the market. Therefore, it is expected to hinder the market growth during the forecast period.
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Analog Devices Inc: The company offers digital IC for applications including automotive, portable, motor and power control, security, test and measurement, and beyond to help meet design needs.
We also have detailed analyses of the market’s competitive landscape and offer information on 20 market companies, including:
Broadcom Inc., Huawei Technologies Co. Ltd., Infineon Technologies AG, Intel Corp., Lattice Semiconductor Corp., MediaTek Inc., Micron Technology Inc., Micross Inc., NXP Semiconductors NV, Qualcomm Inc., Renesas Electronics Corp., Samsung Electronics Co. Ltd., Semiconductor Manufacturing International Corp., SK Inc., STMicroelectronics International N.V., Taiwan SEMICONDUCTOR CO. LTD, Taiwan Semiconductor Manufacturing Co. Ltd., Texas Instruments Inc., and Toshiba Corp.
Technavio market forecast is an in-depth analysis of the market and its players through combined qualitative and quantitative data. The analysis classifies companies into categories based on their business approaches, including pure-play, category-focused, industry-focused, and diversified. Companies are specially categorized into dominant, leading, strong, tentative, and weak, based on their quantitative data analysis.
The Global Digital Integrated Circuit (IC) Market is experiencing a dynamic transformation driven by rapid technological developments and the ever-expanding Internet of Things (IoT) landscape. Miniaturization has become a cornerstone, enabling the integration of complex functionalities into smaller chips. This evolution is crucial for diverse sectors such as the healthcare industry, automation in cars, and tablets, demanding low power consumption and efficient manufacturing costs.
In this era of connectivity, sensors and logic gates are vital components facilitating seamless interactions between devices. Flash Memory ICs and microcontrollers play pivotal roles in storing and processing data efficiently. Moreover, the rise of cloud computing and big data necessitates advanced digital signal processing solutions.
The demand for low-power solutions is escalating, especially with the advent of Electric Vehicles (EVs) and BYOD (Bring Your Own Device) trends in the Information Technology (IT) industry. Companies like PragmatIC Semiconductor and Apogee Semiconductor are at the forefront, leveraging gallium arsenide and silicon technologies to meet these demands.
As the market evolves, the need for skilled professionals proficient in NOR, OR, AND functions, multiplexers, and memory technologies becomes paramount. Industry verticals are witnessing a surge in demand for digital signal processors and specialized chips like image signal processors, illustrating the diverse applications within the Global Integrated Circuits industry. In this landscape, companies like Semiconductor Manufacturing International Corp (SMIC) are pivotal, driving innovation and shaping the future of digital ICs.
The market analysis and report forecasts market growth by revenue at global, regional & country levels and provides a market growth analysis of the latest trends and growth opportunities from 2018 to 2028.
Digital IC Market Scope |
|
Report Coverage |
Details |
Page number |
183 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 8.55% |
Market Growth 2024-2028 |
USD 173.49 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
17.3 |
Regional analysis |
APAC, North America, Europe, Middle East and Africa, and South America |
Performing market contribution |
APAC at 64% |
Key countries |
US, China, Japan, South Korea, and Taiwan |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Analog Devices Inc., Broadcom Inc., Huawei Technologies Co. Ltd., Infineon Technologies AG, Intel Corp., Lattice Semiconductor Corp., MediaTek Inc., Micron Technology Inc., Micross Inc., NXP Semiconductors NV, Qualcomm Inc., Renesas Electronics Corp., Samsung Electronics Co. Ltd., Semiconductor Manufacturing International Corp., SK Inc., STMicroelectronics International N.V., Taiwan SEMICONDUCTOR CO. LTD, Taiwan Semiconductor Manufacturing Co. Ltd., Texas Instruments Inc., and Toshiba Corp. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Type
7 Market Segmentation by End-user
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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