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© Entegris – for illustrative purposes only
Analysis |

Gartner: semiconductor revenue to grow 17% in 2024

In its latest forecast, Gartner projects that global semiconductor revenue will grow 16.8% in 2024 and reach USD 624 billion. In 2023 however, the market is expected to to drop 10.9%, reaching USD 534 billion.

As 2023 draws to a close, the semiconductor industry faces a double-digit decline even with the strong demand for AI chips and GPUs.

“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,” said Alan Priestley, VP Analyst at Gartner, in a press release. “Reduced demand from smartphones and PC customers coupled with weakness in data center/hyperscaler spending are influencing the decline in revenue this year.”

However, 2024 is anticipated to be a recovery year with a growth in revenue for all chip types, driven by double-digit growth in the memory industry. 

Semiconductors Revenue Forecast, Worldwide, 2021-2025 (Billions of U.S. Dollars)
© Gartner

2023 has not been a fun year for the memory market, and it's not going to end on a fun note either. The global memory market is forecasted to fall 38.8% in 2023 – before rebounding in 2024, growing 66.3%.

Low, or even anaemic demand and declining pricing due to large oversupply will cause NAND flash sales to collapse 38.8% to USD 35.4 billion in 2023, says Gartner. However, over the next 3-6 months, NAND industry pricing will bottom out, and vendor conditions will improve. Gartner analysts predict a strong recovery in 2024, with revenue increasing by 49.6% YoY to USD 53 billion.

DRAM vendors are pursuing the market price down to minimise inventory due to massive oversupply and lack of demand. Oversupply in the DRAM market will persist throughout the fourth quarter of 2023, which will trigger a price recovery. However, the full impact of price hikes won't be felt until 2024, when DRAM revenue is predicted to rise by 88% to reach USD 87.4 billion.

High-performance GPU-based servers and accelerator cards are becoming more and more in demand in data centres due to advancements in generative AI (GenAI) and massive language models. Due to this, workload accelerators must be installed in data centre servers in order to facilitate AI workloads for both training and inference. Gartner analysts estimate that by 2027, the integration of AI techniques into data centre applications will result in more than 20% of new servers including workload accelerators.


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March 01 2024 9:18 am V22.3.47-2