The global semiconductor market is poised for significant expansion, with Gartner’s latest report forecasting a 14% increase in revenue, reaching $717 billion by 2025. Released on October 28, 2024, the report highlights a strong recovery for the industry following a recession in 2023, primarily fueled by the surging demand for AI-related semiconductors and increased electronics production. This year, semiconductor revenue is expected to reach $630 billion, reflecting an impressive growth rate of 18.8% compared to the previous year. However, the automotive and industrial sectors continue to face challenges with weak demand, as noted by Rajeev Rajput, Senior Principal Analyst at Gartner.
Specifically, the memory markets, particularly DRAM and NAND, are projected to experience substantial growth that will significantly enhance the overall revenue of the semiconductor sector. The memory segment is expected to grow by 20.5% in 2025, reaching $196.3 billion. The ongoing shortage in 2024 is likely to drive NAND prices up by 60% this year, although a modest 3% price drop is anticipated in 2025 as supply stabilizes. Meanwhile, DRAM revenue is also set to rise due to increasing demand for advanced technologies such as double data rate 5 (DDR5) and high-bandwidth memory (HBM). This segment is projected to generate $115.6 billion in revenue in 2025, up from $90.1 billion in 2024.
Advancements in AI technologies, particularly with graphics processing units (GPUs), are continuing to transform the semiconductor landscape. According to Gartner, revenue from GPUs utilized in AI model training is expected to soar to $51 billion, representing a 27% increase by 2025. The growing demand for HBM, crucial for next-generation AI servers, has prompted significant investments in production. HBM revenue is anticipated to rise by 70% in 2025, reaching $21 billion. By 2026, over 40% of HBM chips are expected to support AI inference workloads, underscoring the increasing significance of semiconductors in enabling advanced AI applications across various sectors.