Market Overview

Disruption From IoT and Automotive Shifts Revenue Mix, Drives Consolidation in $468B Semiconductor Industry - A Recent Analysis by MarketsandMarkets™


CHICAGO, June 6, 2019 /PRNewswire/ -- Infineon Technologies AG (OTCQX:IFNNY) and Cypress Semiconductor Corporation (NASDAQ:CY) announced that the companies signed a definitive agreement under which Infineon will acquire Cypress for USD 23.85 per share in cash, corresponding to an enterprise value of EUR 9.0 billion (~USD 10.1 billion). The bold bid is to strengthen offerings and counter aggressive moves by competitors over the last several years. Infineon expects to be catapulted into the top position in the supply of semiconductors to automotive OEMs, competing directly with automotive leader NXP Semiconductors.

Revenue Impact Matrix

Internet of Things has already revolutionized the consumer application industry, with various other IoT applications, such as connected cars and wearable electronics, evolving and likely to further drive opportunities for many IoT chip manufacturers across the large and complex IoT ecosystem. Huge IoT investments by companies such as Intel (US), Samsung (South Korea), IBM (US), and Qualcomm (US), along with government funding in IoT research projects, are driving the growth of the IoT market - especially in the UK, China, and Japan. The Infineon–Cypress deal will result in a wider portfolio of products for automotive, industrial, and IoT projects.

MarketsandMarkets™ Knowledge Store:

Cypress is a significant player in the IoT market because of its ultralow-power PSoC technology. However, the company was not able to use this technology beyond generic radios. With the acquisition of Broadcom's wireless IoT business in April 2016, the company aimed to strengthen its position in embedded systems markets such as automotive and industrial. It also strived to establish itself as a leader in the consumer IoT market, which includes wearable electronics and home automation solutions.

Post-acquisition, Cypress, with a range of microcontrollers with software and connectivity products, intends to sell alongside Infineon's microprocessors and sensors. The acquisition would seek to address new IoT applications into industrial and consumer markets, and supply to automotive and driver-assistance providers.

"The semiconductor industry has witnessed drastic changes in the competitive landscape over the past five years, as companies syndicate to gain scale while overcoming challenges such as rising costs and dwindling customer bases", said Sachin Garg – Associate Vice President, Semiconductor Division at MarketsandMarkets™. NXP Semiconductors NV recently announced a $1.76 billion deal for Marvell Technology Group Ltd.'s Wi-Fi connectivity business, while Nvidia Corp. agreed to buy chipmaker Mellanox Technologies Ltd. for $6.9 billion in March 2019.

NXP Semiconductors N.V., a leading player in the segment and a major market share holder, is an established supplier in this industry. This trend was started in 2014-15 and is followed by this recent acquisition. It is in a favorable position for growth owing to the positive outlook for the automotive semiconductor, Industrial, and IoT markets. A broad product portfolio and the ability to form strategic collaborations and partnerships would make the company a leading player in the expected IoT boom.

The company's acquisition of the U.S.-based Freescale Semiconductor Ltd. would help both the companies to dominate the automotive semiconductor and the general-purpose MCU products segments. With Infineon acquiring Cypress, it would result in more competitive and complex market with multiple offering and redefined market strategies, supply chain network and addressing client pain points.

With China withholding Qualcomm Inc.'s failed effort of NXP Semiconductor's takeover by offering USD 44 billion, it is under observation of multiple players and industry as whole to see whether Infineon can garner the necessary regulatory approvals in the midst of ongoing and escalating trade battles between world's powerful economies; the US and China.

About MarketsandMarkets™

MarketsandMarkets™ provides quantified B2B research on 30,000 high growth niche opportunities/threats which will impact 70% to 80% of worldwide companies' revenues. Currently servicing 7500 customers worldwide including 80% of global Fortune 1000 companies as clients. Almost 75,000 top officers across eight industries worldwide approach MarketsandMarkets™ for their painpoints around revenues decisions.

Our 850 fulltime analyst and SMEs at MarketsandMarkets™ are tracking global high growth markets following the "Growth Engagement Model – GEM". The GEM aims at proactive collaboration with the clients to identify new opportunities, identify most important customers, write "Attack, avoid and defend" strategies, identify sources of incremental revenues for both the company and its competitors. MarketsandMarkets™ now coming up with 1,500 MicroQuadrants (Positioning top players across leaders, emerging companies, innovators, strategic players) annually in high growth emerging segments. MarketsandMarkets™ is determined to benefit more than 10,000 companies this year for their revenue planning and help them take their innovations/disruptions early to the market by providing them research ahead of the curve.

MarketsandMarkets's flagship competitive intelligence and market research platform, "Knowledge Store" connects over 200,000 markets and entire value chains for deeper understanding of the unmet insights along with market sizing and forecasts of niche markets.

Mr. Shelly Singh
MarketsandMarkets™ INC.
630 Dundee Road
Suite 430
Northbrook, IL 60062
USA: +1-888-600-6441


MarketsandMarkets Logo (PRNewsfoto/MarketsandMarkets)

Cision View original content to download multimedia:

SOURCE MarketsandMarkets

View Comments and Join the Discussion!
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at