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© ra2studio dreamstime.com Analysis | June 12, 2017

Total chip IoT forecast scaled back

IC Insights scaled back its total semiconductor sales forecast for system functions related to the IoT in 2020 by about USD 920 million, mostly because of lower revenue projections for connected cities applications.
The updated forecast still shows total 2017 sales of IoT semiconductors rising about 16.2 percent to USD 21.3 billion (with final revenues in 2016 being slightly lowered to USD 18.3 billion from the previous estimate of USD 18.4 billion), but the expected compound annual growth rate between 2015 and 2020 has been reduced to 14.9 percent versus the CAGR of 15.6 percent in IC Insights’ original projection from December 2016. Total semiconductor sales for IoT system functions are now expected to reach USD 31.1 billion in 2020 versus the previous projection of USD 32.0 billion in the final year of the forecast.

IC Insights’ revised outlook for IoT semiconductor sales by end-use market categories shows that semiconductor revenues for connected cities applications are projected to grow by a CAGR of 8.9 percent between 2015 and 2020 (down from 9.7 percent in IC Insights’ original forecast). Meanwhile, the IoT semiconductor market for wearable systems is expected to show a CAGR of 17.1 percent (versus 18.8 percent in the previous projection). The lower growth projection in chip sales for connected cities systems is a result of anticipated belt tightening in government spending around the world and the slowing of smart meter installations now that the initial wave of deployments has ended in many countries. Slower growth in semiconductor sales for wearable systems is primarily related to IC Insights’ reduced forecast for smartwatch shipments through 2020.

The updated outlook nudges up semiconductor growth in the industrial Internet category to a CAGR of 24.1 percent (compared to 24.0 percent in the December 2016 forecast) and slightly lowers the annual rate of increase in connected homes and connected vehicles to CAGRs of 21.3 percent and 32.9 percent, respectively (from 22.7 percent and 33.1 percent in the original 2017 report).

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October 15 2018 11:56 pm V11.6.0-2