IC Insights: Last year, fabless accounted for 33% of the total global semiconductor market revenue, a record high

IC Insights announced yesterday the sales and growth rates of Fabless and IDM in 2020. The data showed that Fabless sales soared 24% last year, while IDM sales only grew by 8%.

IC Insights has updated the latest version of the McClean Report. The latest data in April shows that the global Fabless and IDM sales growth rates are very different.

Generally speaking, the sales growth rate of Fabless is higher than that of IDM, but there are exceptions. In 2010, IDM revenue increased by 35%, while Fabless revenue increased by 29%.

In the past two years, the growth momentum of these two types of semiconductor companies has been significantly different. In 2019, the memory market performed poorly, and IDM revenue fell by 20%. In contrast, Fabless revenue only fell by 1%. In 2020, Fabless revenue increased by 24%, while IDM only increased by 8%.

Even taking into account the booming years of 2017 and 2018 (IDM revenue grew by 31% and 16% respectively in these two years), the compound growth rate of IDM from 2010 to 2020 was only 3%, one percentage point lower than the compound growth rate of the entire global semiconductor market during the same period. In contrast, the average annual growth rate of Fabless was 8%, which was twice the total compound annual growth rate of the semiconductor market in the same decade.

Due to the significant difference in revenue growth rates between the two types of companies, Fabless’ share of total growth increased, except for 2010, 2015, 2017, and 2018, as shown below:

In 2002, Fabless revenue accounted for only 13% of the entire semiconductor market. As the storage market soared in 2017 and 2018, Fabless's share declined in both years. However, the decline in the storage market in 2019 reversed this situation, and Fabless's share jumped 4.1 percentage points to 29.9% that year.