Global Semiconductor Industry on Track for 2024 Recovery But Near-Term Headwinds Remain
August 16, 2023 | SEMIEstimated reading time: 1 minute

With sequential IC sales declines beginning to moderate, the global semiconductor industry appears to be nearing the end of a downcycle and is expected to begin to recover in 2024, SEMI, in partnership with TechInsights, reported in the Semiconductor Manufacturing Monitor. In Q3 2023, electronics sales are projected to post healthy quarter-on-quarter growth of 10%, while memory IC sales are expected to log double-digit growth for the first time since the downturn started in Q3 2022. Logic IC sales are predicted to remain stable and improve as demand gradually recovers.
Headwinds will continue for the semiconductor manufacturing sector in the second half of the year, SEMI and TechInsights reported. Drawdowns of high inventory at integrated device manufacturer (IDM) and fabless companies will continue to suppress fab utilization rates to much lower levels than those in the first half of 2023. The weakness is projected to extend declines in capital equipment billings and silicon shipments for the rest of the year despite stable results in the first half of 2023.
Market indicators point to a semiconductor industry bottoming at the end of the first half of 2023, and the industry has since started a recovery, setting the stage for continued growth in 2024. All segments are projected to log year-over-year increases in 2024, with electronics sales surpassing its 2022 peak.
“The slower-than-expected demand recovery will delay the normalization of inventory until the end of 2023, later than we previously anticipated, leading to additional reductions in fab utilization rates in the short term,” said Clark Tseng, Senior Director of Market Intelligence at SEMI. “However, recent trends suggest that the worst is over for ICs. We anticipate semiconductor manufacturing will bottom in Q1 2024.”
“While semiconductor markets have seen a sharp downturn the last four quarters, equipment sales and fab construction have been performing much better than expected,” said Boris Metodiev, Director of Market Analysis at TechInsights. “Government incentives have been driving new fab projects and strong backlogs have helped equipment sales.”
The Semiconductor Manufacturing Monitor (SMM) report provides end-to-end data on the worldwide semiconductor manufacturing industry. The report highlights key trends based on industry indicators including capital equipment, fab capacity, and semiconductor and electronics sales, and includes a capital equipment market forecast. The SMM report also contains two years of quarterly data and a one-quarter outlook for the semiconductor manufacturing supply chain including leading IDM, fabless, foundry, and OSAT companies. An SMM subscription includes quarterly reports.
Testimonial
"In a year when every marketing dollar mattered, I chose to keep I-Connect007 in our 2025 plan. Their commitment to high-quality, insightful content aligns with Koh Young’s values and helps readers navigate a changing industry. "
Brent Fischthal - Koh YoungSuggested Items
Statement from the Global Electronics Association on the July 2025 Tariff on Copper Foil and Electronics-Grade Copper Inputs
07/31/2025 | Global Electronics AssociationWe are disappointed by today’s decision to impose a 50% tariff on imported copper foil and other essential materials critical to electronics manufacturing in the United States.
I-Connect007 Editor’s Choice: Five Must-Reads for the Week
08/01/2025 | Nolan Johnson, I-Connect007We start with the latest report from the Global Electronics Association: North American PCB sales are down 8.6% in June. That might sound grim, but keep reading—there’s more to the story. Bookings are holding steady, and Dr. Shawn DuBravac offers context that paints a more balanced picture. Next, we turn our gaze to India, where mobile phone exports have surged 127-fold over the past decade. That stat alone says volumes about India’s emergence as a force in electronics manufacturing, something we’ll be digging into more deeply in an upcoming SMT007 feature.
iDEAL Signs Technology Partner Agreement for SuperQ MOSFETs with Power System Specialist Richardson Electronics, Ltd.
08/01/2025 | PR NewswireiDEAL Semiconductor, a fabless power semiconductor company focused on delivering breakthrough efficiencies, has announced it will partner with Power and RF specialist, Richardson Electronics.
Brent Laufenberg Appointed CIO of the Global Electronics Association, Advancing Technology and Member Services
07/31/2025 | Global Electronics AssociationThe Global Electronics Association (formerly IPC International Inc.) announces the appointment of Brent Laufenberg as its new Chief Information Officer (CIO).
Federal Electronics Mexico Enhances SMT Line with Installation of Heller Industries Reflow Oven
08/01/2025 | Federal ElectronicsFederal Electronics, a leader in providing advanced electronic manufacturing services, has enhanced its surface mount technology (SMT) operations with the installation of a new Heller Industries reflow oven at its facility in Hermosillo. This upgrade supports the company’s continued growth in high-reliability markets such as aerospace, medical, industrial, and instrumentation.