Semiconductor Sales Topped 1 Trillion Last Year

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The Semiconductor Industry Association (SIA) said Monday morning that global unit sales of semiconductors rose to more than a trillion units in 2018 and sales revenue reached a record annual total of $468.8 billion. Simple math says that an average price per chip is just over 50 cents.

The largest fastest growing segment of the chipmaking business is memory devices such as dynamic random-access memory (DRAM) chips and NAND (storage) flash memory products. Sales of DRAM products jumped by 36.4% year over year, and NAND product sales rose nearly 15%. Overall, the two chip types accounted for $158 billion in 2018 sales on a sales jump of 27.4%.

SIA President and CEO John Neuffer said:

Market growth slowed during the second half of 2018, but the long-term outlook remains strong. Semiconductors continue to make the world around us smarter and more connected, and a range of budding technologies – artificial intelligence, virtual reality, the Internet of Things, among many others – hold tremendous promise for future growth.

Logic chips accounted for $109.3 billion in 2018 revenues and micro-ICs (integrated circuits, including microprocessors) accounted for $67.2 billion in sales.

According to Intel’s most recent price list, its lowest cost Celeron microprocessor costs $42 and its top-of-the-line i7 costs $1,723 per copy. The lowest priced DRAM modules on Monday, according to DRAMeXchange, are 2Gbyte modules (256-megabyte chips in an eight-chip module) selling for $1.60 (about $0.20 per chip). Even NAND flash is cheap — a 16Gbye module (eight chips of 2Gbyte storage capacity each) costs just $2.65 or about 33 cents per chip.

Last year’s other fast-growing product categories included power transistors (14.4% growth and total revenue of $14.4 billion) and analog products (10.8% growth and total sales of $58.8 billion). Sales of all products combined, excluding memory chips, increased by nearly 8% in 2018.