Intel Continues to Lead Struggling Semiconductor Market: Gartner

By Jeffrey Burt  |  Posted 2012-12-17 Print this article Print

However, Gartner analysts are predicting $311 billion in semiconductor revenues in 2013, which would be a 4.5 percent increase from this year. Still, Peter Middleton, a principal analyst at Gartner, said the issues that roiled the market in 2012 could continue to impact the market as it goes into 2013.

"The looming fiscal cliff, ongoing European debt crisis, slower emerging market growth and regional tensions have all played a part in reduced growth projections for semiconductor revenue in both 2012 and 2013," Middleton said in a statement. "Inventory levels were already high at the start of the second half of 2012, and as PC demand rolled off, supply simply overshot demand."

The PC market will remain an issue, according to Gartner. Production fell 2.5 percent last year, and will continue to be weak heading into 2013. That said, ultramobile PCs—such as the Ultrabooks championed by Intel—while a smart part of the market, will see strong growth. In addition, production of tablets will jump by 38.5 percent in 2013, to 207.1 million units, thanks to the popularity of Apple’s iPad Mini, Amazon’s Kindle Fire and Google’s Nexus 7 devices. White-box makers also are seeing strong demand.

The overall mobile phone market will continue to soften, with the economy driving down demand for devices, the analysts said. However, entry-level smartphones—particularly those based on Google’s Android operating system—will see continued growth in emerging markets. Globally, smartphone unit production is expected to grow 33 percent, according to Gartner.

In the memory space, the DRAM market won’t recover from the slump until the second half of 2013. When that happens, it will help drive the entire semiconductor market into 2014, the analysts said. Memory revenues will grow 15.3 percent, with semiconductor revenue jumping to $342 billion in 2014.


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