Report: Wireless And Memory Chip Suppliers Shine In 2004
El Segundo, CA -- Leading semiconductor suppliers offering memory and wireless devices dramatically outperformed firms focused on other products in 2004, according to final annual semiconductor rankings from iSuppli Corp.'s Competitive Landscaping Tool (CLT) service.
Top semiconductor suppliers that derive much or most of their revenue from sales of memory chips, i.e. Samsung, Infineon, AMD/Spansion, and Hynix, expanded their revenue by rates ranging from 29.1 to 58% in 2004. Others -- including Texas Instruments, STMicroelectronics, Infineon, Philips Semiconductors, Freescale Semiconductor, Qualcomm, Analog Devices, and Sharp Electronics -- received major boosts in revenue due to their participation in the wireless market.
Sales of memory chips surged by 43.5% in 2004 as DRAM prices remained strong and demand boomed for flash devices used in wireless and consumer-electronics applications. Meanwhile, due to the continuing boom in mobile phone sales, wireless represented the fastest-growing application market for semiconductors in 2004, with revenues growing by 31.2% for the year.
This marks the second consecutive year that semiconductor suppliers in the memory and wireless market segments achieved the highest growth rates among top chip suppliers.
Samsung in a league of its own
The figure below presents iSuppli's final ranking of the top-20 semiconductor suppliers in 2004.
Among the top semiconductor suppliers, number-two-ranked Samsung continues to pursue a growth path that seems almost disconnected from the rest of the semiconductor market. Samsung's 58% growth in 2004 tops even its amazing 43.1% expansion in 2002. Even when Samsung's performance is measured in comparison only to those semiconductor market segments where it participates, its performance is still amazing. Revenue growth in 2004 for the aggregated markets where Samsung competes was 27%. Samsung's growth in 2004 was more than double this number.
Texas-sized growth for Texas Instruments
Texas Instruments moved up strongly in the rankings to capture the third position in 2004, up from number four in 2003.
The company's 30.3% growth was the second highest among the top-10 suppliers and truly stands out, given the fact that Texas Instruments did not receive a boost from the high-growth memory market -- in contrast to Samsung. In the aggregated semiconductor market segments where Texas Instruments competes, it achieved a number-one ranking in 2004.
Infineon and Analog Devices on the rise
Infineon in 2004 became a member of the top-five semiconductor supplier club, rising from number seven in 2003 to number four in 2004 with growth of 29.1%. The German semiconductor supplier was number eight in the rankings in 2001 and has been on a consistent path of market-beating growth for the last three years.
Analog Devices was the only new member of the top-20 club in 2004, with its rank moving up from number 22 in 2003.
A stellar year
Overall, 2004 was a stellar year for the overall semiconductor industry, with 44 of the 229 companies tracked by iSuppli achieving revenue growth of more than 50%.
Worldwide semiconductor revenue growth in 2004 was 24%, compared to 14.9% in 2003. Only 22 companies, representing less than 10% of the semiconductor suppliers in iSuppli's market coverage, saw their revenues decline. Only five of those companies suffered revenue declines of more than 20%.
Chip suppliers are expected to have a tougher time in 2005, as worldwide semiconductor revenue growth is expected to slow to 6.1% this year, iSuppli predicts.
Source: iSuppli Corporation