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The semiconductor micro components market size is estimated to grow by USD 30.8 billion at a CAGR of 4.38% between 2023 and 2028. The market experiences continuous expansion, driven by several key factors. New product innovations significantly contribute to market growth, as technology advances and companies introduce more sophisticated and efficient components. Additionally, the increasing popularity of smartphones and tablets fuels demand for semiconductor micro components, as these devices rely heavily on integrated circuits and other micro components for their functionality. Furthermore, the defense and military sectors represent a significant market for semiconductor micro components, as these industries require advanced and reliable technology for their mission-critical applications. It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2018 to 2022.
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The market is witnessing a surge in demand driven by the proliferation of intricate semiconductor devices across various sectors, including telecommunications, automotive electronics, and the Internet of Things (IoT). These components are characterized by their miniaturized size and energy-efficient design, catering to the needs of modern gadgets like smartphones, laptops, and automated door locks. With the increasing adoption of Artificial Intelligence (AI) and the IoT, there's a growing emphasis on high-performing smartphones and IoT devices that rely on semiconductor components for seamless operation. However, the market faces challenges such as pricing pressures and profit margin concerns, alongside the need for robust semiconductor security to address vulnerabilities in the evolving digital landscape. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
An increase in new product development is notably driving market growth. The market is heavily dependent on the semiconductor industry, which relies on the sale of various electronic devices such as smartphones, tablets, and portable computers. The number of electronic devices on the market has increased significantly. This has increased the demand for semiconductor microprocessors as manufacturers continuously expand their product portfolios to keep up with the ongoing competition. This has led to rapid technological change that has increased the demand for microprocessors, thereby driving the market.
In addition, some semiconductor microcomponent manufacturers continue to invest in research and development and launch several new products. For example, in January 2021, Qualcomm announced its Boosted Snapdragon 870 5G mobile platform. The new Snapdragon 870 will deliver all-around improved performance for mature gameplay with a blazing-fast Qualcomm Snapdragon Elite gaming experience, truly global sub-6GHz 5G and mmWave, and ultra-intuitive AI. Hence, increasing new product launches will increase the demand for semiconductor microcomponents, driving the growth of the market during the forecast period.
Increased proliferation of IoT is a key trend influencing market growth. IoT is the latest trend in the global technology space. IoT connects all major home devices to the internet. This includes cars, televisions, laptops, coffee makers, automatic door locks, GPS-enabled pet trackers, wearable devices, and mobile phones forming a network of connected devices. With the availability of high-speed wireless Internet connections such as 4G worldwide and the massive demand (and production) for Wi-Fi and GPS-enabled smartphones, the demand for fast and accurate information is also increasing.
This demand has created a need for more accurate DSPs that can compute and retrieve accurate information in a limited time frame when everything goes mobile. IoT can connect billions of devices. Processing data from these devices requires more extensive use of the DSP. By 2022, it was expected that over 30-40 billion devices would be connected to the internet. To achieve this, cellular standards must evolve to meet the low-power and low-cost requirements of IoT components. Therefore, the increasing adoption of IoT will increase the demand for semiconductor microcomponents, driving the growth of the market during the forecast period.
The increased demand for miniaturization is challenging the market growth. Miniature semiconductor devices are so small that they require manual or mechanical handling. Improvements in technology and the emergence of small devices such as smartphones, tablets, and wearable technologies such as smartwatches have increased the demand for small DSPs. Miniaturization, therefore, requires vendors to constantly update their products with more advanced and compact DSPs to meet consumer demand. This forces market vendors to invest heavily in procuring expensive equipment to create intelligent and smart systems. Vendors also need to increase their budgets to create these intelligent systems. Rapid advances in technology are forcing market players to invest more in manufacturing intelligent systems, which can lead to lower profitability. Therefore, such factors will adversely affect the growth of the market.
Along with all this, the market requires significant capital investment, posing a major challenge to its growth. For example, microprocessors are manufactured in a critical environment and it would cost USD 5 billion to USD 6 billion to set up such a manufacturing facility. Rapid advances in technology have given rise to sophisticated electronic products that require certain types of semiconductor capital. Therefore, in order to meet the growing demand of consumers, manufacturers need more capital to expand their production capacity and invest in research and development. Market-leading vendors who are unable to make significant capital expenditures may be at a disadvantage relative to other major competitors, particularly with respect to innovative product launches, which hurts profitability and could also affect the growth of the market during the forecast period.
The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Market Customer Landscape
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.
ABB Ltd: The company offers different types of semiconductor micro components that are used in solar panel cell applications.
The report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market share growth by the microprocessors segment will be significant during the forecast period. A microprocessor is an electronic component integrated into a single IC. Millions of tiny components work together, including transistors, diodes, and resistors. This chip has numerous functions such as data storage, timing functions, and interaction with peripherals. This IC is used in many electronic devices such as tablets, servers, smartphones, and embedded devices. Demand for microprocessors is expected to increase during the forecast period owing to the global spread of communication devices such as smartphones and tablets and the increasing popularity of IoT.
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The microprocessors segment was valued at USD 93 billion in 2018. Increasing demand for microprocessors in automobiles, increasing demand for game consoles, and increasing use of tablets in public places (restaurants, retail stores, airports) are some of the major reasons for the increasing revenue of the market. Additionally, recent technological advances, increased ruggedness, reduced power consumption, superior performance, improved quality, and efficient features all contribute to the increased demand for microprocessors. In recent years, the number of electronic devices on the market has increased significantly. This has increased the demand for semiconductor microprocessors as manufacturers continuously expand their product portfolios to keep up with the ongoing competition. Rising demand for advanced microprocessors from various electronic device manufacturers to offset the growing demand for tablets, smartphones, and IoT devices is one of the key factors behind this segment's dominance. Hence, such factors are fuelling the growth of the segment during the forecast period.
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APAC is estimated to contribute 84% to the growth of the market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
APAC has the largest geographic segment in the market by value. The presence of several well-known semiconductor foundries, such as Taiwan Semiconductor Manufacturing, United Microelectronics, Samsung and Semiconductor Manufacturing International, is driving the market in this region. These manufacturers are investing heavily in the area to build new factories. For example, in December 2020, Qualcomm Technologies, LG Uplus, and LG Electronics successfully deployed their 5G mm-wave network for the first time in South Korea using commercial 5G smart phones at the Kumoh National Institute of Technology (KIT). Moreover, APAC's revenue share is expected to grow faster than other regions due to lower labor costs, huge market potential, and flexible government policies. Hence, such factors are driving the market in APAC during the forecast period.
The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.
Semiconductor Market: Semiconductor Market Analysis APAC, North America, Europe, South America, Middle East and Africa - China, US, Germany, Canada, UK - Size and Forecast
Vietnam - Semiconductors Market: Vietnam - Semiconductors Market by Application, End-user, and Device - Forecast and Analysis
Japan Semiconductor Device Market: Japan Semiconductor Device Market by Application, Device, and Material - Forecast and Analysis
The market is witnessing rapid growth driven by advancements in advanced driver-assistance systems and the rising demand for electric vehicles (EVs). These components play a crucial role in enabling in-car connectivity and enhancing processing power for various applications. With increasing sensor integration and communication capabilities, semiconductor micro components are powering the development of connected and autonomous vehicles and smart manufacturing processes. Additionally, they contribute to the evolution of advanced medical devices and diagnostic equipment, ensuring precision, efficiency, and connectivity. The market is also influenced by the telecommunications industry's adoption of 5G technology, driving demand for low-power semiconductor micro components with enhanced energy efficiency and high performance. Technologies such as VLSI and implanted DSPs are further revolutionizing industries like television, air conditioners, and consumer electronics, optimizing production processes and enhancing overall digital signal processing capabilities.
Market Scope |
|
Report Coverage |
Details |
Page number |
190 |
Base year |
2023 |
Historic period |
2018 - 2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 4.38% |
Market growth 2024-2028 |
USD 30.8 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
4.11 |
Regional analysis |
APAC, North America, Europe, South America, and Middle East and Africa |
Performing market contribution |
APAC at 84% |
Key countries |
China, Taiwan, US, South Korea, and Japan |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
ABB Ltd., ADVACAM Oy, Advanced Micro Devices Inc., Allegro MicroSystems Inc., Analog Devices Inc., Hendon Semiconductors, Infineon Technologies AG, Micro Hybrid Components, Microchip Technology Inc., Micron Technology Inc., Nichia Corp., NXP Semiconductors NV, Panasonic Holdings Corp., Renesas Electronics Corp., Samsung Electronics Co. Ltd., Seoul Semiconductor Co. Ltd., STMicroelectronics International N.V., Texas Instruments Inc., Toshiba Corp., and Utmel Electronics |
Market dynamics |
Parent market analysis, market forecast, Market forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, Market growth and Forecasting, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for 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 Product
7 Market Segmentation by End-user
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Opportunity/Restraints
11 Competitive Landscape
12 Competitive Analysis
13 Appendix
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