The global semiconductor revenues fell 3 per cent to $298 billion in 2012 from $307 billion last year, according to a preliminary report by Gartner.
The top 25 semiconductor vendors' revenue declined 4.2 per cent, more than the industry average, and accounted for a smaller portion of the industry's total revenue — 68.2 per cent in 2012, compared with 69.2 per cent in 2011.
The industry was expected to show little growth in the early part of 2012, although order rates were expected to creep up in the second half, paving the way for a recovery phase in 2013.Third quarter order rates were below seasonal expectations and guidance for the fourth quarter of 2012 forecast further declines.
"Uncertainty about the state of the macro economy, coupled with ongoing inventory overhang, sent ripples through the semiconductor industry," said Steve Ohr, research director at Gartner.
"The hardest hit areas include the PC supply chain, memory, analogue and discrete components. The PC business, ordinarily a growth driver, was on a negative slope for the first time in many years. The personal computer production fell 2.5 per cent in 2012. Even the smartphone juggernaut had begun to show signs of maturing, though it remained the strongest driver for revenue growth in 2012,” Ohr added.
Intel recorded a 2.7 per cent revenue decline, mostly due to declining personal computer sales. However, the company did hold onto the number one market share position for the 21st consecutive year, capturing 16.6 per cent of the 2012 semiconductor market, its best performance ever.
At number two, Samsung Electronics saw its semiconductor revenues fall due to declines in its three major product areas, DRAM, NAND flash and system integrated circuit. Bucking the industry trend and rising three places to number three, Qualcomm attributed its 29.6 per cent growth to continued adoption of smartphones and the growth of 3G and LTE technology in emerging regions, such as China and India.
The only other top 10 semiconductor vendor to record positive growth in 2012 was Broadcom, which rose from the tenth to the ninth position with growth of 8.8 per cent.