Intel, Samsung Lead Worldwide Semiconductor Market: Gartner

Intel recorded a 2.2 percent revenue decline as strong performance in its data center and embedded systems group couldn't offset declining PC sales.

Worldwide semiconductor revenue totaled $315.4 billion in 2013, a 5.2 percent increase from 2012 revenue of $299.9 billion, with Intel, Samsung and Qualcomm taking the top three spots, according to a report from IT research firm Gartner.

Intel recorded a 2.2 percent revenue decline as strong performance in its data center and embedded systems group was not enough to offset a declining PC market.

However, the company was able to maintain the top market share position for the 22nd consecutive year, capturing 15.2 percent of the 2013 semiconductor market, down slightly from its peak of 16.5 percent in 2011.

Micron Technology saw the biggest revenue growth among the top 25 due to its midyear acquisition of Elpida Memory. The company benefited from the recovery in commodity dynamic random access memory (DRAM) pricing and strong growth for low-power DRAM where Elpida is strong.

"After a weak start to 2013 due to excess inventory, revenue growth strengthened in the second and third quarters before leveling off in the fourth quarter. Memory, in particular DRAM, led this growth, not due to strong demand, but rather weak supply growth," Andrew Norwood, research vice president at Gartner, said in a statement.

SK Hynix and Micron Technology benefited the most from the strong memory market, propelling them both into the top five for the first time. SK Hynix's revenue increased 43.2 percent, the strongest organic growth in the top 25.

On the other hand, the report found four companies underperformed expectations by more than 10 percent—Rohm, Renesas Electronics, Samsung and Sony.

While Samsung maintained the No. 2 position for the 12th year in a row, its overall growth was below the market and its performance in Gartner’s relative industry performance (RIP) index was poor.

The report noted one reason for the company’s underwhelming performance was Samsung’s own handset business, which reduced its reliance on the Exynos processor and baseband processor from Samsung's semiconductor operation in favor of competitor Qualcomm.

Market leaders in Gartner's RIP index were MediaTek and Qualcomm, two mobile handset suppliers, which grew 35 percent and 28 percent better than their respective markets.

"In fact, the overall market faced a number of demand headwinds with PC production declining 9 percent and the premium smartphone market showing signs of saturation, with growth tilting toward lower-priced, entry-level and midrange smartphone models," Norwood continued. "These demand headwinds become very visible when looking at revenue growth outside of memory, where the rest of the semiconductor market could only muster 0.4 percent growth."