According to Gartner, Inc., global semiconductor revenue is expected to grow 16.8% in 2024 to reach $624 billion. In 2023, the market is expected to decline by 10.9% to reach $534 billion.
"We have reached the end of 2023, and strong demand for chips that support artificial intelligence (AI) workloads such as graphics processing units (GPUs) will not be enough to save the semiconductor industry from a double-digit decline in 2023," Gartner Vice President Analyst Alan Priestley said. "Reduced demand from smartphone and PC customers, combined with softer data center/hyperscale spending, is impacting revenue declines this year."
However, 2024 is expected to be a rebound year, with revenue rising across all chip types, driven by double-digit growth in the memory market (see Figure 1).
Memory revenue to rebound in 2024 after double-digit decline
The global memory market is expected to decline by 38.8% in 2023 and rebound by 66.3% in 2024.
Lower pricing due to weak demand and a massive oversupply will result in a 38.8% decline in NAND flash revenue, to $35.4 billion in 2023. Over the next 3-6 months, NAND industry pricing will bottom out and supplier conditions will improve. Gartner analysts predict a strong recovery in 2024, with revenue growing to $53 billion, a 49.6% year-over-year increase.
Due to severe oversupply and insufficient demand, DRAM manufacturers have lowered market prices to reduce inventory. Oversupply in the DRAM market will continue through the fourth quarter of 2023, which will trigger a price rebound. However, the full impact of the price increase won't be felt until 2024, when DRAM revenue is expected to grow 88% to $87.4 billion.
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