Gartner Sees Global Semiconductor Growth Slowdown Amid Pandemic Recovery Thanks To Inflation, Fuel Costs

Gartner Sees Global Semiconductor Growth Slowdown Amid Pandemic Recovery Thanks To Inflation, Fuel Costs
  • IT research firm Gartner expects global semiconductor sales growth to slow down in 2022 and fall 2.5% in 2023 due to weak sales of mobile phones and personal computers, Reuters reports.
  • Gartner highlighted how the surging inflation and higher energy and fuel costs wreaked a double whammy on consumer disposable income, affecting spending on electronic products like PCs and smartphones.
  • Gartner expected global semiconductor revenue to grow 7.4% in 2022 to $639.2 billion, down from its previous view of 13.6% growth compared with 26.3% last year.
  • For 2023, Gartner expects chip revenue to contract to $623.1 billion.
  • "It could easily be a lot worse than that, but it will probably bottom out next year and then start to recover in 2024," VP Richard Gordon said in an interview.
  • He acknowledged how the pandemic-induced demand surge for smartphones and PCs inflicted a crisis on other industries, driving up prices and delaying production.
  • Gordon said that when millions of cell phones are taken out of the market, the market flips into an oversupply, and chip pricing tends to fall dramatically.
  • Gordon saw supply constraints in some sectors, like 5G equipment, but saw improvement from the first half of next year.
  • Leading contract chipmaker Taiwan Semiconductor Mfg. Co Ltd TSM and chip-gear maker ASML Holding NV ASML reported strong results, while chipmaker Micron Technology, Inc MU warned of a down cycle.
  • The U.S. geared up to finalize its Chips Act to drive domestic chipmaking.
  • Price Action: TSM shares traded higher by 1.21% at $85.44 in the premarket on the last check Wednesday.
  • Photo via Wikimedia Commons

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