Staff Reporter
The global semiconductor market is set to grow nearly 10% in 2025, driven by strong demand for artificial intelligence and data center chips, while traditional segments such as smartphones and automotive are expected to lag, ING analysts said in a note.
The forecast of 9.5% growth is below the 11.2% estimate from the World Semiconductor Trade Statistics (WSTS) but exceeds the long-term industry growth rate projected by ASML (AS:ASML), ING noted.
While AI-driven demand is fueling the market, segments like PCs, mobile devices, and traditional automotive semiconductors face headwinds from price pressure and slowing consumer demand, analysts wrote.
NVIDIA Corporation (NASDAQ:NVDA) remains a key player in AI chips, but its latest earnings were poorly received, and Samsung Electronics (KS:005930) has cut its AI semiconductor outlook, analysts said.
Advanced Micro Devices Inc. (NASDAQ:AMD) has announced $5 billion in AI chip revenue for 2024 and anticipates “strong double-digit growth” for 2025.
Meanwhile, Taiwan Semiconductor Manufacturing Co. (TW:2330) predicts a compound annual growth rate of mid-40% for AI accelerators over the next five years, significantly outpacing its overall revenue growth expectations, according to analysts.
ING has also pointed to a rising trend in custom chips (ASICs) for data centers, which could benefit companies like Broadcom Inc. (NASDAQ:AVGO) and Marvell Technology (NASDAQ:MRVL), while posing competitive challenges for Intel (NASDAQ:INTC) and AMD.
Despite some short-term concerns regarding memory chip prices, ING reports strong demand for high-bandwidth memory and advanced logic chips, setting the stage for sustained long-term growth in the industry.
