Nvidia’s Dominance Powers Record Chip Market Growth Amid Industry Challenges
The global semiconductor market soared to a record $162.1 billion in Q2 2024, driven by a 6.7% quarterly increase. Nvidia emerged as the leader, raking in $18 billion — 14.8% of the total — thanks to booming demand for AI processors.
The global semiconductor market reached a record $162.1 billion in Q2 2024, marking a 6.7% increase from the previous quarter and surpassing the previous high from Q4 2021, according to reporting from Peter Clarke at eeNews Europe. Nvidia played a significant role in this growth, contributing $18 billion in revenue, or 14.8% of the total, largely due to strong demand for artificial intelligence (AI) processors. This made Nvidia the top revenue generator in the market, overtaking companies like Intel, which accounted for 7.5% of revenue, and placing it just behind Samsung.
In parallel, data from the Semiconductor Industry Association (SIA) underscores the ongoing momentum in the chip industry. The three-month moving average for global chip sales through August 2024 was $53.12 billion, with the Americas showing particularly strong growth, up 43.9% year-over-year, Clarke notes in a September 24 article. This surge helped push annual global chip market growth to 20.6%, despite declines in regions like Europe, which saw a 9% drop. The resurgence is attributed to demand in consumer electronics and AI applications, though the automotive and industrial sectors remain sluggish, potentially due to the depletion of previously stockpiled inventories.
Editor's note: Our colleague, Peter Clarke, first reported on this market news in EENews Europe, a publication in Elektor's network.
Challenges Abound, Despite Market Growth
Despite the overall market growth, more than half of the semiconductor companies tracked recorded lower sales compared to a year ago. Of the 125 companies monitored, Clarke reports, over 70% reported lower revenue in Q2 2024 than in the record quarter of Q4 2021. Omdia's Cliff Leimbach highlighted that the chip market is becoming increasingly concentrated, with the top ten firms capturing 64% of the total market, significantly higher than the long-term average of 57%.In parallel, data from the Semiconductor Industry Association (SIA) underscores the ongoing momentum in the chip industry. The three-month moving average for global chip sales through August 2024 was $53.12 billion, with the Americas showing particularly strong growth, up 43.9% year-over-year, Clarke notes in a September 24 article. This surge helped push annual global chip market growth to 20.6%, despite declines in regions like Europe, which saw a 9% drop. The resurgence is attributed to demand in consumer electronics and AI applications, though the automotive and industrial sectors remain sluggish, potentially due to the depletion of previously stockpiled inventories.
AI Behind the Chip Market Boom?
Both reports highlight a clear trend: while the chip market continues to set records, growth is unevenly distributed, with Nvidia and a few other leaders benefiting disproportionately from the AI boom, while many companies face stagnant or declining revenues.Editor's note: Our colleague, Peter Clarke, first reported on this market news in EENews Europe, a publication in Elektor's network.
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