Amid severe worldwide shortage of semiconductors, research firm IDC on Wednesday said that the global semiconductor industry will see normalization and balance by the middle of 2022, with a potential for overcapacity in 2023 as larger scale capacity expansions begin to come online towards the end of 2022.
IDC added that it expects the worldwide semiconductor market to grow by 17.3% in 2021 versus 10.8% in 2020. The growth is driven by mobile phones, notebooks, servers, automotive, smart home, gaming, wearables, and Wi-Fi access points, with increased memory pricing. IC shortages are also expected to continue easing through 4Q21 as capacity additions accelerate, it added.
“The semiconductor content story is intact and not only does it benefit the semiconductor companies, but the unit volume growth in many of the markets that they serve will also continue to drive very good growth for the semiconductor market,” Mario Morales, Group Vice President, Enabling Technologies and Semiconductors at IDC, said.
As per IDC, dedicated foundries have been allocated for the rest of the year, with capacity utilization at nearly 100%. Front-end capacity remains tight but fabless suppliers are getting the production they need from their foundry partner. Front-end manufacturing is starting to meet demand in 3Q, however, larger issues and shortages will remain in back-end manufacturing and materials.
