Experts from the analytical company IC Insights claim that in 2021, the share of semiconductor products in the cost of electronic systems reached 33.2% last year. This is a record value. The previous record was set in 2018.
Historically, higher CAGRs in the semiconductor industry compared to the electronic systems market have been driven by an increase in the cost or content of semiconductors used in electronic systems. Given that the global growth rate of shipments of smartphones, automobiles and PCs has matured and slowed down over the past 10 years, the difference between the 3.5% CAGR recorded in the electronic systems market between 2011 and 2021 and the CAGR of 6 .5%, recorded in the same period in the market of semiconductor products, analysts associate with an increase in the share of semiconductor products and their cost.
2009 was the first year on record in which the content of semiconductors in electronic systems increased while the semiconductor market declined. This situation happened again in 2015. The total semiconductor market decreased by 1%, but the share of semiconductor products increased from 24.5% in 2014 to 24.8% in 2015. Until 2017, 2010 with 25.9% was a record year for the content of semiconductor products in electronic systems. This mark was easily surpassed in 2017 with 28.9%. A new high was reached in 2018. The dynamics is clearly shown in the graph.
Of course, the upward trend in the cost of semiconductor products in electronic systems has a limit. Whatever it is, after reaching it, the average annual growth of the semiconductor industry will exactly match the growth of the electronic systems market, i.e. will be about 4%. According to IC Insights, the “ceiling” is at least 40% and will not be reached in the next five years.