Semiconductor revenue grows for the first time since 2021

According to market research firm Omdia, the global semiconductor industry recorded a 3.8 percent revenue increase in Q2 2023. It’s the first quarterly revenue growth since the year-ending quarter of 2021. The five straight quarters of decline from Q1 2022 to Q1 2023 was the longest such period since the firm began tracking the semiconductor market in 2002.

The prolonged decline for over a year means the current semiconductor market size by revenue is at just 79 percent of what it was in the same period last year. Omdia estimates the global revenue to have crossed $125 billion this past quarter. The total revenue was $160 in Q2 2022. “It will take time to return to the revenue levels of late 2021,” the research firm states. That upward journey may have begun, though.

Nvidia led the semiconductor revenue rebound in Q2 2023

The semiconductor revenue growth rate in Q2 2023 was in line with the historical average of 3.4 percent revenue increase in the second quarter of the year. However, some segments of the industry saw a massive deviation from the historical average this year. The DRAM market, for example, registered a 15 percent revenue increase this past quarter, double the Q2 average of 7.5 percent.

Thanks to the growing AI craze, the revenue from the data processing segment also grew 15 percent in Q2 2023. This segment accounted for almost one-third of the global semiconductor revenue (31 percent), the largest share of all market segments. The smartphone/wireless sector was the second-largest contributor to the global revenue. However, a decline in smartphone sales means revenue from the wireless segment declined three percent. The automotive semiconductor sector registered a 3.2 percent revenue growth this past quarter.

Omdia says Nvidia led the long-missing semiconductor revenue rebound. The American company contributed to a whopping 54 percent of the total revenue increase ($2.5 billion of $4.6 billion) between April and June 2023. It has climbed up to the third spot in the global semiconductor ranking by revenue, behind Intel and Samsung. This is quite a turnaround from Nvidia after dropping to the tenth spot in the third quarter of last year. Intel and Samsung have held the top two spots for a long time now, occasionally switching positions between themselves.

However, Nvidia is catching up to them fast. It registered a 47.5 percent quarterly revenue increase in Q2 2023, reaching $7.9 billion. Intel’s revenue grew 10.1 percent to reach $12.3 billion, while Samsung recorded a 5.8 percent growth for a total revenue of $9.4 billion. Qualcomm and Broadcom were the next two biggest semiconductor companies by revenue this past quarter. However, they both suffered a quarterly decline, allowing SK Hynix to close the gap with a 39.9 percent increase. You can see the full chart below.