IDC Estimates OSAT Market Size to Drop by 13.3% YoY in 2023
July 25, 2023 | IDCEstimated reading time: 2 minutes

According to an upcoming report, IDC’s Semiconductor Manufacturing Services: 2022 Worldwide OSAT Market: Vendor Ranking and Insight, a surge in global demand for applications such as AI, high-performance computing (HPC), 5G, automotive, and Internet of Things (IoT) fueled the semiconductor supply chain expansion. The outsourced semiconductor assembly and testing (OSAT) industry grew steadily in 2022 with the market size reaching US$44.5 billion, an annual growth of 5.1%.
"OSAT, which is vital for the final quality and efficiency of chips, is at the core of the downstream portion of the semiconductor industry chain. As HPC, AI and Machine Learning evolve, we're expecting a shift in advanced packaging will experience heterogenous integration from 2D to 2.5D/3D structures, as per Moore's law. Looking ahead, we predict that manufacturers will boost their investment to satisfy the growing market demand," says Galen Zeng, Senior Research Manager, Semiconductor Research, IDC Asia/Pacific.
Among the worldwide top 10 OSAT vendors, there are six in Taiwan, three in China, and one in the United States, with a total market share of 80.1%. Vendors in Taiwan include ASE, PTI, KYEC, Chipbond, ChipMOS, and Sigurd; vendors in China include JCET, TFME, and Hua Tian; and the US vendors are represented by Amkor.
Nine of the top 10 OSAT vendors are located in the Asia/Pacific region, playing an important role in the worldwide OSAT industry. The worldwide regional dynamics from 2021 to 2022 show that the market shares of vendors in Taiwan went down by 2.5% to 49.1%, affected by the abrupt decline of driver integrated circuit (IC), memory, and mid-range and low-end mobile phone chip packaging capacity. There is hope for a turnaround in 2023 as some short-term orders and urgent orders come in. In China, OSAT plants continued to expand in line with the Chinese government's semiconductor domestication policy, which coupled with the rising sales of AMD, a major IC design manufacturer coordinated with TFME, spurred the market shares of local vendors to pick up by 1.0% to 26.3%. Amkor in the United States, the world's largest vendor for automotive OSAT, saw its market share increase by 1.7% to 18.8% thanks to the increase in chip orders for industries, automobiles, and 5G high-end/flagship mobile phones, while vendors in other regions including South Korea, Japan, and Southeast Asia accounted for about 5.8% of the total market shares.
In 2023, the semiconductor industry is still in the destocking stage due to the severe fall in consumer electronics demand and decline in demand for cloud servers for non-AI applications. The capacity utilization of many OSAT plants came in at 50%–65% in the first half of the year (1H23) and was expected to recover to 60%–75% in 2H23 along with the moderate recovery of demand after stock adjustment, and even 80% promoted by the urgent orders for advanced packaging, but still with a gap with the 70%–85% in 2022. It is estimated that the worldwide semiconductor OSAT market size will drop by 13.3% year on year in 2023. However, with the gradual recovery of the semiconductor industry, coupled with the deployment of vendors in advanced packaging and heterogeneous integration, will drive the overall OSAT industry back to growth in 2024.
Suggested Items
I-Connect007 Editor’s Choice: Five Must-Reads for the Week
06/27/2025 | Nolan Johnson, I-Connect007While news outside our industry keeps our attention occupied, the big news inside the industry is the rechristening of IPC as the Global Electronics Association. My must-reads begins with Marcy LaRont’s exclusive and informative interview with Dr. John Mitchell, president and CEO of the Global Electronics Association. For designers, have we finally reached the point in time where autorouters will fulfill their potential?
Reflections and Priorities: An Update to I-Connect007 Readers
06/24/2025 | Marcy LaRont, I-Connect007The electronics and manufacturing industry is evolving rapidly—with new technologies, deeper global connections, and a growing drive toward sustainability. To reflect these changes and our place in this dynamic space, we’re refreshing our brand.
The Knowledge Base: Building the Workforce of Tomorrow With EMAC
06/24/2025 | Mike Konrad -- Column: The Knowledge BaseAs the electronics manufacturing industry races to meet rising global demand and technological complexity, the need for a highly skilled, future-ready workforce has never been greater. At the forefront of addressing this challenge is The Electronics Manufacturing & Assembly Collaborative (EMAC)—a national initiative dedicated to strengthening the talent pipeline through strategic collaboration with SMTA, education, and government stakeholders.
IPC Rebrands as Global Electronics Association: Interview With Dr. John W. Mitchell
06/22/2025 | Marcy LaRont, I-Connect007Today, following a major announcement, IPC is embracing the rapid advancement of technology with a bold decision to change its name to the Global Electronics Association. This name more accurately reflects the full breadth of its work and the modern realities of electronics manufacturing. In this exclusive interview, Global Electronics Association President and CEO Dr. John W. Mitchell shares the story behind the rebrand: Why now, what it means for the industry, and how it aligns with the organization’s mission.
Global Electronics Association Debuts; New Name Elevates IPC’s 70-Year Legacy as Voice of $6 Trillion Electronics Industry
06/25/2025 | Global Electronics AssociationToday begins a new chapter for IPC as it officially becomes the Global Electronics Association, reflecting its role as the voice of the electronics industry. Guided by the vision of “Better electronics for a better world,” the Global Electronics Association (electronics.org) is dedicated to enhancing supply chain resilience and promoting accelerated growth through engagement with more than 3,000 member companies, thousands of partners, and dozens of governments across the globe.