The global IC foundry industry output is forecast to increase 17% to US$70 billion in 2020, and rise another 6.8% in 2021, according to Digitimes Research's latest report.
Despite the coronavirus pandemic and US-China trade tensions' impacts on the global semiconductor supply chain and overall demand, the output in 2020 will still be driven up by a number of factors.
Demand created by stay-at-home activities is expected to remain robust in the second half of 2020, and the semiconductor supply chain has been ramping up orders to stock up extra inventory as a precaution amid tight foundry capacity.
As 5G smartphones will see increased penetration rates, and new CPUs for high performance computing (HPC) applications will be launched, orders with upstream wafer foundries will continue to rise in the second half of 2020.
Taiwan Semiconductor Manufacturing Company (TSMC) and Samsung Electronics will continue expanding their capacity, unaffected the pandemic.
With emerging applications such as 5G expected to take off and more advanced manufacturing process to be made available, the output value will grow further in 2021.
In the next five years, emerging applications such as 5G and AI will enjoy faster growths. TSMC and Samsung will continue advancing their manufacturing processes and packaging technologies to attract IDMs such as Intel to expand outsourcing.
GlobalFoundries and United Microelectronics Corporation (UMC), despite turning their R&D focus to niche manufacturing processes, are still expected to expand their deployments in emerging businesses such as IoT and autonomous driving.
Digitimes Research expects the global IC foundry industry output to grow at a five-year CAGR of between 6-7% from 2020-2025 to reach US$95 billion in 2025. However, the trade brawl between the US and China remains the biggest uncertainty.