Semiconductor boom could be coming to an end – analysts

silversurfer

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Aug 17, 2014
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The semiconductor market is flattening out after a period of record revenues, according to research outfit Omdia.

The report joins a growing list of warnings that the chip industry is heading for a slowdown because of companies stockpiling components and global economic effects such as inflation.

Omdia's latest analysis of the worldwide semiconductor market shows that it reached a plateau in the first quarter of 2022 following five straight quarters of record revenues and continual growth in demand.

It appears that the decline is rather modest at present, with a drop of just 0.03 percent compared with the previous quarter. The first quarter of the year is also often a "down quarter," Omdia said, as demand wanes after the holiday season, with an average decline in previous years of 4.4 percent.

Nevertheless, that slight drop breaks a straight run that saw the semiconductor market set new revenue records every quarter since the beginning of 2020, observed Omdia's Cliff Leimbach, Senior Research Analyst and author of the company's Semiconductor Competitive Landscape (CLT) Spotlight Service.

According to Omdia's analysis, nearly all semiconductor components experienced some small sequential growth between in 1Q22 versus 4Q21, with the exception being CMOS sensors, which declined 16 percent quarter-over-quarter.

Additional factors that Omdia said came into play in the first quarter included: increases in raw material prices globally, putting pressure on inflation; dampening of consumer spending in Q1, particularly for smartphones; plus ongoing impacts of the pandemic in key markets, which have affected the supply chains for smartphones and other electronic products.
 

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