Semiconductor industry revenue is expected to decline by 3.6% next year

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According to Gartner, due to global inflation, weak economy, weakening demand, and rising costs, the semiconductor industry revenue will decline next year, falling by 3.6%, from $618 billion in 2022 to $596 billion, lower than the previous forecast of $623 billion.

Semiconductor industry revenue 2023
The revenue of the semiconductor industry ushered in high growth in 2021, with a growth rate of 26.3%, and the growth rate in 2022 has dropped to 4% and will turn negative next year, with revenue in 2023 similar to 2021’s $595 billion. Consumer demand is expected to decline next year, largely due to lower disposable income, which is linked to inflation and higher costs elsewhere. The demand in the enterprise market is relatively stable, the decline rate is smaller than that in the consumer market, and it is more elastic.

In view of the current weak demand for consumer electronics products, high inventory levels, and customers’ more urgent demands for significantly lower prices, it is expected that the storage market will experience a relatively large decline next year, with revenue falling by 16.2%. The deteriorating economic outlook is negatively impacting smartphones, PCs, and other consumer electronics, analysts expect DRAM revenue to decline 2.6% to $90.5 billion in 2022 and another 18% to $74.2 billion in 2023.

In the first quarter of 2022, a rapidly deteriorating demand environment was masked by higher prices due to NAND flash supplier shutdowns. As a result, there will be a serious inventory surplus in the third quarter of 2022, which will continue into the first half of 2023. Analysts expect NAND flash revenue to grow 4.4 percent to $68.8 billion in 2022, but fall 13.7 percent to $59.4 billion next year. At present, DRAM and NAND flash memory manufacturers have slammed the brakes, trying to maintain the price system and avoid a sharp drop.

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