Chip industry revenue tops $500bn for the first time amid roaring demand
Revenue in the global chip industry soared 25 per cent last year, exceeding an eyewatering $500bn for the first time on record, according to new data.
A combination of strong demand amid a short supply and the inflation of raw material costs has pushed up the average selling price for semiconductors, Stamford-based research services company Gartner found.
The shortage hit the automotive industry particularly hard and has pushed a number of large car manufacturers to dial back their production.
“The 5G smartphone market also helped drive semiconductor revenue, with unit production more than doubling to reach $555m (£407m) in 2021, compared to $250m (£183m) in 2020,” research vice president at Gartner, Andrew Norwood explained.
Pandemic restrictions and homebound populations also prompted a steep increase in computer and smartphones demand across the world – tech in which semiconductors are critical.
The jump in demand, to satisfy remote working, learning and entertainment needs, saw traditional technology firms battling it out with the automotive industry for a free-flow supply.
Samsung Electronics knocked Intel off the top spot, regaining the crown for the first time since 2018, after its semiconductor revenue soared more than 31 per cent last year.
Samsung pulled in more than $75.9m (£55.7m) from its chips division, while Intel snagged $73.1m (£53.6m) for the highly coveted piece of tech.