According to the financial results released for the last quarter, of the five major chip applications, demand for most semiconductor applications are declining or stagnant, and only automotive semiconductors are expected to witness annual growth for 2023, with estimated annual growth of 12%, said DIGITIMES Research director Tony Huang.
Huang said that other semiconductor applications, including data processing, communications, and consumer electronics, are expected to experience declines in 2023 except for the industrial application, which is anticipated to remain stable compared to 2022. Huang added that among the top 20 global semiconductor companies, those with a higher proportion of revenue from automotive sales demonstrated relatively outstanding performance.
Huang expected that among the top 20 semiconductor companies, Nvidia, Broadcom, Infineon, ST Microelectronics, and Microchip to see annual sales growth in 2023. Meanwhile, since automotive semiconductors are the only bright spot in the second quarter of 2023, Huang revised their sales outlook from previously slight annual declines to a range of -2% to +2% compared to 2022.
Overall, the semiconductor market is expected to decline by 12% compared to 2022, with the seven companies mentioned above demonstrating their respective competitiveness in facing the cyclical downturn.
Compared to 2022, Infineon, NXP, ST Microelectronics, Texas Instruments, Renesas, and Onsemi, the top six automotive semiconductors companies in 2022 by sales, are expected to post revenues growth of about 25%, 9%, 34%, more than 20% (specific number undisclosed), 3.4%, and 35%, respectively. Texas Instruments said that only the automotive business would see better demands in the second and third quarters, with other businesses showing lackluster performance.
Huang said that companies expected to see higher growth are those who have a higher market share in the power semiconductors market.
The continued growth of EVs has driven Infineon, ST Microelectronics, and Onsemi to have more outstanding performances. Besides, Infineon, ST Microelectronics, Texas Instruments, and Onsemi, the top four automotive semiconductor companies by market share in 2022, saw sales growth of over 20% in the second quarter of the year.
Huang said that the sales outlook for automotive semiconductors in the third quarter of 2023 is generally the same as the second quarter, making it one of the few areas with better visibility among the five major semiconductor applications. However, it can be observed that the growth momentum of automotive semiconductors is slowing down in the third quarter.
According to Huang, in the medium to long term, the compound annual growth rate (CAGR) of semiconductor demand for EVs is expected to be around 20–25% over the next five years, while the CAGR of semiconductors demand for ADAS and autonomous driving is projected to be in the range of 15–20%. These two factors contribute to the growth of the automotive semiconductor market.
Despite the increasing chip content per vehicle, the simplification of components and architecture in EVs might lead to declining ASPs of cars, contrasting with those for servers and smartphones. Servers have been witnessing higher ASPs as the shipment share of more expensive AI servers has increased. Costs of smartphones, meanwhile, are rising due to more powerful APs, better lenses, and CIS with higher resolutions. More smartphones featuring flexible and foldable AMOLED displays also led to higher prices.
