The “New” IC Industry Cycle Model
The IC industry is set to emerge from a difficult 5-year period of minimal growth. From 2007-2012, the IC market grew at an average annual rate of 2.1%. In IC Insights’ opinion, the “bottom” of the current cycle in the worldwide economy and IC industry was reached in 2012 and 2013 will mark the beginning of the next cyclical upturn—one in which the IC industry CAGR will more than triple to 7.4% in the next 5-year period.
Overall, semiconductor industry cycles are becoming increasingly tied to the health of the worldwide economy. While poor semiconductor industry growth has occurred during periods of strong worldwide economic growth, primarily due to semiconductor industry overcapacity and the resulting IC price declines, it is rare to have strong semiconductor industry growth without at least a “good” worldwide economy to support it. Thus, over the next five years, annual global semiconductor market growth rates are expected to gain significant momentum and closely mirror the performance of the worldwide economy.