Driven partly by M&A activity, fewer semiconductor companies are influencing a bigger share of the market, said IC Insights.
Not including foundries, IC Insights forecasts that semiconductor suppliers Intel, Samsung, Qualcomm, Broadcom, and SK Hynix will account for 41% of the market share in 2016. This represents a 9-point increase from the 32% share held by the five suppliers 10 years ago.
The firm forecasts that top 10 semiconductor suppliers will account for 56% market share in 2016, an 11-point swing from 45% in 2006. The top 25 companies in IC Insights’ list are forecast to account for around three-quarters of all semiconductor sales this year.
Following a surge in semiconductor merger and acquisition (M&A) agreements in 2015, the pace of transactions eased a bit in the first half of 2016. However, 2016 is now forecast to be the second-largest year ever for chip industry M&A announcements, thanks to three major deals struck in 3Q16 that have a combined value of $51 billion. These deals were SoftBank’s purchase of ARM, Analog Devices’ intended purchase of Linear Technology, and Renesas’ potential acquisition of Intersil.
Figure 1: 2016 forecast of semiconductor companies' worldwide market share, not including foundries. (Source: IC Insights)
With the surge in mergers and acquisitions expected to continue over the next few years, IC Insights claims that the consolidation will raise the shares of top suppliers even higher.