According to Yonhap News,

(SEOUL=Yonhap News) Rapid progress in connected IT devices and Big Data services has led to an unprecedented surge in the global demand for semiconductors, turning the industry into a goose that lays golden eggs.


A semiconductor factory in Germany (Yonhap)

According to IHS Markit, the annual revenue of the global semiconductor industry recorded USD 352 billion (KRW 398 trillion) in 2016, Wall Street Journal reported on April 26.

The figure almost doubled from 2003, and is over twice the revenue of U.S. automakers, and more than the total annual sales at U.S. fast food restaurants.

Behind the recent boom is the the fact that semiconductors are an essential component of smartphones, computers, connecterd cars, and IoT (Internet of Things) devices.

In particular, the global IoT industry was worth only USD 3.8 billion in 2014, but Gartner Inc. estimates it will reach USD 8.4 billion this year, and USD 20.4 billion by 2020.

Reflecting these changes, DRAM chip prices have risen by 80 percent from July 2016 to March 2017.

During the same period, the price of NAND chips, which unlike DRAMs preserve stored content even after a device is turned off, went up by 27 percent.

Market experts predict the boom to last for at least another decade, after which prices are thought to at least double, if not triple.


SK hynix's 72-layer 3D NAND flash and 1-Terabyte SSD (solid state drive) currently being developed based on the new NAND technology (courtesy of SK hynix Inc.)

The world's largest chip maker Intel made USD 55 billion in total revenue, despite losses incurred from its wireless technology business.

The second largest player Samsung Electronics earned USD 40.3 billion in 2016 from selling semiconductors, and witnessed a 48.3 percent increase in operating profit (KRW 6 trillion from selling semiconducters) for the first quarter of 2017, even after losing some USD 5 billion in last year's Galaxy Note 7 recall.

In third place is Qualcomm, which recorded USD 15.4 billion in total revenue in 2016.

Avril Wu, research director at DRAMeXchange, said "this is just the start," predicting that the semiconductor industry still has many years left in it to grow.

heeva@yna.co.kr

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