Gartner, in its recent findings, reports that global semiconductor revenue is projected to grow 16.8% in 2024 to total $624 billion. In 2023, the market is forecast to decline 10.9% and reach $534 billion. However, 2024 is forecast to be a bounce-back year where revenue for all chip types will grow, driven by double-digit growth in the memory market.
In its report, Gartner also found that the worldwide memory market is forecast to record a 38.8% decline in 2023 and will rebound in 2024 by growing 66.3%.
Due to high oversupply level and lack of demand, DRAM (dynamic random access memory) vendors are chasing the market price down to reduce inventory. Through the fourth quarter of 2023, DRAM market’s oversupply will continue which will trigger a pricing rebound. However, the full effect of pricing increases will only be seen in 2024, when DRAM revenue is expected to increase 88% to total $87.4 billion.
Gartner analysts also estimate that by 2027, the integration of AI techniques into data center applications will result in more than 20% of new servers including workload accelerators.
Alan Priestley, VP Analyst, Gartner
We are at the end of 2023 and strong demand for chips to support artificial intelligence (AI) workloads, such as graphics processing units (GPUs), is not going to be enough to save the semiconductor industry from double-digit decline in 2023. Reduced demand from smartphones and PC customers coupled with weakness in data center/hyperscaler spending are influencing the decline in revenue this year.
