Gartner revises global semiconductor revenue decline estimates from 2.5% to 3.6% for 2023

After posting double-digit revenue growth last year, the semiconductor industry is expected to see its revenue decline by 3.6% to $596 billion in 2023 due to the worsening economic situation and the resulting slump in demand for consumer electronics, according to Gartner’s latest report, released Monday. The revenue for the current year is expected to grow at a modest 4% to reach $618 billion.  

Gartner has revised its estimates for both 2022 and 2023. In July, Gartner had projected the revenue in 2022 to grow to $639 billion and then decline by 2.5% to reach $623 billion in 2023.  

“Rapid deterioration in the global economy and weakening consumer demand will negatively impact the semiconductor market in 2023,” said Richard Gordon, Practice Vice President, Gartner. 

Though demand for technology products in the consumer segment has declined, demand for products in enterprise networking, enterprise computing, industrial, medical and commercial transportation has remained robust despite the economic slowdown and geopolitical concerns, according to Gartner.  

Gordon attributed this to the “strategic investments” made by organisations that want to strengthen their infrastructure to support hybrid work, digital transformation, and business expansion plans.  

“Markets such as industrial, telecom infrastructure, and data centre will be less impacted by consumer sentiment and spending in the short term,” added Gordon. 

The Gartner report further claims that the revenue from the overall memory chips segment will remain flat in 2022 and decline by 16.2% in 2023. In the dynamic RAM (DRAM) segment, revenue is expected to decline by 2.6% to $90.5 billion in 2022 and by 18% in 2023 to $74.2 billion. 

That said, revenue from the NAND storage segment is expected to grow by 4.4% to $68.8 billion in 2022, only to decline by 13.7% in 2023 to reach $59.4 billion.