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© ic insights Analysis | June 22, 2017

Cellphone IC sales top total PC in 2017

Higher memory prices accelerate sales growth in both cellphones and personal computing systems but cellular handsets will become the largest application for ICs this year.
The ongoing slump in shipments of standard personal computers along with the drop-off in tablets are setting the stage for cellphone IC sales to finally surpass integrated circuit revenues in total personal computing systems this year, writes market researcher IC Insights.

IC sales for cellular phone handsets are projected to grow 16 percent in 2017 to USD 84.4 billion, while the integrated circuit market for personal computing systems (desktop and notebook PCs, tablets, and thin-client Internet-centric units) is now forecast to increase 9 percent to USD 80.1 billion this year.

IC sales for both cellphones and total personal computing systems are strengthening significantly in 2017 primarily because of strong increases in the amount of money being spent on memory, with the average selling price (ASP) of DRAM expected to climb 53 percent and NAND flash ASP forecast to rise 28 percent this year. In 2016, IC sales for cellphone handsets grew 2 percent after rising 1 percent in 2015, while dollar volume for integrated circuits used in personal computing systems increased just 1 percent last year after falling 6 percent in 2015.

Cellphone IC sales are also getting a lift from a projected 5 percent increase in shipments of smartphones, which are being packed with more low-power DRAM and nonvolatile flash storage, while growth in personal computing is expected to be held back by 3 percent declines in both standard personal computer and tablet unit volumes in 2017.

Shrinking shipments of desktop and notebook computers enabled cellphone IC sales to surpass integrated circuit revenues for standard PCs in 2013. During 2015 and 2016, cellphone IC sales came close to catching up with integrated circuit sales for total personal computing systems. In 2017, cellular phone handsets are now forecast to take over as the largest end-use systems category for IC sales.

The gap between IC sales for cellphones and total personal computing systems is projected to widen by the end of this decade. Cellphone integrated circuit sales are expected to increase by a compound annual growth average (CAGR) of 5.3 percent in the 2015-2020 forecast period to USD 92.1 billion versus personal computing IC revenues rising by CAGR of just 2.9 percent to USD 83.8 billion in 2020, says the update of IC Insights.

The forecast shows IC sales for standard PCs climbing 11.2 percent in 2017 to USD 67.5 billion after increasing about 4 perecent in 2016 to USD 60.7 billion. Tablet IC sales are now expected to drop 2 percent to USD 11.8 billion in 2017 after falling 11 percent in 2016 to USD 12.1 billion. IC sales for thin-client and Internet/cloud computing centric systems—such as laptops based on Google’s Chromebook platform design—are projected to rise 15 percent in 2017 to a USD 838 million after surging 21 percent in 2016 to USD 728 million.

Between 2015 and 2020, IC sales for standard PCs are expected to grow by a CAGR of 4.1 percent to USD 71.6 billion in the final year of the updated outlook, while table integrated circuit revenues are projected to fall by -3.9 percent annual rate in the period to about USD 11.0 billion and ICs in Internet/cloud computing are forecast to rise by CAGR of 13.8 percent to more than USD 1.1 billion.

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