Editing by Li Panpan
The Chinese mainland accounted for 36% of the global analog IC market in 2020. With the growing demand in the application fields, especially from automobiles and industrial, top global IDMs such as TI and ADI are increasing product prices and support to the Chinese market, according to an opinion article by JW Insights.
The Chinese semiconductor industry in 2021 experienced a production expansion peak and ended with mixed forecasts from the market. Price increase might come to a halt for chips in general because of more production capacity in 2022, but not for analog chips.
It also can be learned from analyzing the 2021 fiscal year financial reports recently released by the top 5 IDMs that the shortage of analog chips will continue for a long time, with the automobile industry and the Chinese market being the decisive factors.
According to IC Insights, the current global top five analog IDMs are TI, ADI, Skyworks, Infineon, and ST. In terms of revenues in 2021, TI topped the list with $18.344 billion, followed by ST ($14.453 billion), Infineon ($12.527 billion), ADI ($7.318 billion), and Skyworks ($511 million). Among them, the analog chip revenue was $14.05 billion for TI, and $4.62 billion for ST along with its MEMS, and sensor revenue.
IC Insights also said that from 2021 to the end of 2026, the CAGR of the analog chip market would reach 11.8%, ahead of the overall CAGR of the chip market (10.2%).
Compared with market growth forecast, IDMs’ supply of analog chips continues to be in shortage. The current inventory of TI and ADI is 116 days and 115 days, respectively, which are still lower than their respective targets.
Investors and IDMs have set their sights on production expansion, with TI planning to build six 12-inch factories by 2030. But long-term planning cannot solve recent problems. Analog chip shortage may last a few years.
IDMs’ confidence to expand production comes from growing market opportunities. Five major analogs IDMs all agreed that the automotive/industrial field and the Chinese market are important market keywords and, to some extent, represent the major development trend of analog chips in the next five to ten years.
Several companies are seeing high growth in their automotive and industrial businesses in 2021. They accounted for 62%, 72%, and 34.1% of the total revenue of TI, ADI, and ST, respectively. ST said it saw unprecedented demand in the automobile industry. IC Insights also said by the end of 2022, analog chip sales in the automotive and industrial sectors will account for 24.7% and 19.5% of total analog chip sales.
