A slow-growth economy, weakness in industrial markets, and slowing growth in China affected industrial semiconductor growth in 2015, as researchers report revenues rose less than 1% in 2015. The flat conditions followed 12% revenue growth in industrial semiconductors in 2014 and 10% growth in 2013, according to a new report from industry researcher IHS Inc.
“The flat growth in the industrial semiconductor market last year is a bit discouraging, after a period of such robust growth, but there’s hope on the horizon,” Robbie Galoso, associate director, industrial semiconductors, IHS Technology, said in releasing a new report from the firm’s Industrial Semiconductor Intelligence Service. “The industrial market showed resilience in 2015 and all signs are pointing to improving growth in the future.”
IHS pointed to a gradual acceleration in the U.S. economy that lifted demand for industrial equipment in 2015. The researcher also pointed to demand for industrial semiconductors used for commercial aircraft, LED lighting, digital-video surveillance, climate control, smart meters, traction, wireless application-specific testers, and medical electronics. But continued weakness in overall industrial end markets and a slowdown in China’s factory automation and power and energy markets in particular helped to stall overall industrial semiconductor revenue growth.
Despite a tough 2015, IHS says strong momentum in industrial electronics will propel growth in the category over the next five years. The researcher predicts an 8% compound annual growth rate in global industrial semiconductor revenue growth between 2015 and 2020.
There was some shifting among the top industrial semiconductor suppliers in 2015, according to IHS’ Industrial Semiconductor Intelligence Service. Texas Instruments maintained its position as the largest industrial semiconductor supplier in the world in 2015, followed by Infineon Technologies and Intel. STMicroelectronics dropped to fourth place, and Analog Devices remained in fifth position.
“The semiconductor industry had a record level of merger and acquisition activity in 2015 that impacted some of the leading industrial semiconductor players,” according to Galoso. “Strategic acquisitions will continue to play a major role in shaping the overall semiconductor market rankings in key industrial semiconductor segments.”
Due to its merger with Freescale, NXP rose from 16th to seventh place, registering share gains in manufacturing and process automation, military and civil aerospace, power and energy, medical electronics and other industrial applications, IHS said.
“The company will have a stronger presence in nearly all semiconductor device categories especially in microcomponents, analog and sensors,” Galoso said.