Analyst Cuts 2024 Chip Market Growth Prediction

Amidst fluctuations in the chip market in the first quarter of 2024, there were signs of weakness that raised concerns among industry analysts. However, as the calendar turned to April, a noticeable shift occurred, with the market gaining strength. This resurgence was primarily attributed to the widespread excitement surrounding artificial intelligence (AI) technologies, which fueled a surge in processor sales and led to an increase in memory prices.

Looking ahead to 2025, projections for the global chip market growth vary among different analysts, with estimates ranging from 11 percent to as high as 15.6 percent. This range underscores the dynamic nature of the semiconductor industry and the various factors that can influence its trajectory.

The latest data from the World Semiconductor Trade Statistics (WSTS) revealed that the global semiconductor market experienced significant growth, reaching $149.9 billion in the second quarter of 2024. This marked a 6.5 percent increase from the previous quarter and an impressive 18.3 percent rise compared to the same period in the previous year.

Among the top semiconductor companies, the second quarter of 2024 brought mixed results. While most companies reported strong revenue gains compared to the first quarter, a few experienced declines. Notably, MediaTek and STMicroelectronics were among the outliers with revenue decreases. On the other hand, memory companies such as SK Hynix, Kioxia, Samsung Semiconductor, and Micron Technology saw substantial growth, with some exceeding 30 percent increases.

Looking at the broader picture, the weighted average growth of the top fifteen semiconductor companies in the second quarter of 2024 was 8 percent. Memory companies led the way with a remarkable 22 percent growth, while non-memory companies also showed positive momentum with a 3 percent increase. These figures highlight the resilience and adaptability of the industry in responding to market dynamics.