In 2022, the top 25 semiconductor vendors saw a 2.8% increase in revenue and accounted for 77.5% of the market. However, the year began with many semiconductor devices in short supply, leading to longer lead times and higher pricing, which impacted electronic equipment production for various industries. As a result, Original Equipment Manufacturers (OEMs) began stockpiling chip inventory to hedge against shortages.
As the year progressed, the global economy started to slow under the weight of rising inflation, increased interest rates, and higher energy costs, compounded by ongoing COVID-19 lockdowns in China, which affected many global supply chains. Consumers also began to cut back on spending, leading to decreased demand for PCs and smartphones and decreased enterprise spending in preparation for a potential recession, all of which impacted overall semiconductor growth.
Despite a 10.4% decline in revenue, Samsung Electronics retained the top spot. The company’s revenue drop was primarily due to reduced memory and NAND flash sales. Intel held onto the second position with 9.7% market share, but saw a 19.5% decline in revenue growth due to decreased demand for consumer PCs and increased competition in the x86 processor market.
Memory, which made up around 25% of semiconductor sales in 2022, was the worst-performing device category, with a 10% decrease in revenue. By the middle of the year, the memory market was already showing signs of a significant drop in demand as OEMs depleted their inventory in anticipation of stronger demand. Many memory companies have now announced reduced capital expenditure for 2023 and some have even cut wafer production to reduce inventory levels and stabilize the market.
Overall, nonmemory revenue grew 5.3% in 2022, but performance varied greatly among different device categories. The strongest growth came from analog devices, with a 19% increase, followed by discretes, which saw a 15% increase from 2021. This growth was driven by strong demand from the automotive and industrial sectors, fueled by trends in vehicle electrification, industrial automation, and energy transition.