Status of the Processor Industry 2023

Glossary            

Processor definitions    

Report objectives           

Scope of the report        

 3-page summary           

Executive summary       

Processor market overview        

Processor market           

• Forecast by processor type         
• Forecast by market        
• Forecast overview          

Processor market Trends – Overview by end markets      

• Mobile and Consumer  
  • Focus on Smartphones and Tablets         
  • Focus on Personal Computers    
  • Focus on Wearables and Other Consumer Devices           
• Automotive      
• Telecom & Infrastructure (Focus on Data Center) 

Ecosystem and supply chain       

• Processor players           
• Start-up funding analysis            
• Focus on China and US/China trade-war

Technology trends         

• Instruction Set Architecture and IP          
• Transistor scaling            
• CPU market and technology       
• GPU      
• APU      
• SoC FPGA           
• AI ASIC 
• DPU      
• Advanced packaging      
• Chiplets
• Computing and memory trends
• Next-gen computing      

Outlook

Appendix          

• Appendix – Processor definition
• Appendix – Artificial Intelligence
• Appendix – Yole Group Presentation       

A record 2021 led to a flat 2022, but the outlook for 2028 is bright

The processor market witnessed a record-breaking year in 2021, soaring to $155.5B with robust growth of 22.3%. However, the subsequent year saw a modest contraction, with revenue settling at $154.0B. The main component of the downtrend was the CPU segment, primarily attributed to reduced shipments in the PC category with intensifying competition from non-x86 APUs. In tandem, the GPU market experienced a light contraction to $22.6B in 2022, mainly due to a decline in PC GPU shipments and waning enthusiasm for crypto-currency. Projections for 2023 foresee a 3% resurgence to $23.3B, propelled by the burgeoning Generative AI trend. On the other hand, the APU market grew notably in 2022, and the data center sector exhibited substantial growth, resulting in a shift in revenue distribution. While processor total revenue is poised to touch $242B by 2028, CPUs are set to maintain their dominance, while GPUs will see a significant rise, and the data center segment is anticipated to emerge as the fastest-growing market.

The evolving environment in an arena of heavy-weights and underdogs

The processor market is primarily dominated by a few key players: Intel, AMD, Nvidia, and Qualcomm, with these giants holding 54% of the total market share. Competition is growing, with new entrants and tech giants like Amazon and Alibaba entering the CPU arena. Qualcomm, MediaTek, and Apple lead in APUs, with 32% of the market. The SoC FPGA and AI ASIC segments are led by AMD, Intel, and tech giants like Google and Amazon. The processor startup landscape is dynamic, raising substantial funds, especially in AI-focused endeavors, with China leading the pack. The semiconductor industry in China is evolving, driven by investments and a growing ecosystem. In 2022, notable M&A activities included AMD's acquisition of Xilinx and Pensando, Intel’s failed attempt to acquire Tower Semiconductor, and Nvidia's abandoned bid for Arm.

Chip designers and process integrators use new tools to maintain the pace of innovation

Advanced generations of processors require more integrated circuitry, especially larger blocks of logic and SRAM. The advancement towards more densely packed logic was once as simple as the next lithography shrink, but as transistors become smaller, they are increasingly complex and increasingly more costly to manufacture. In 2022, the industry is approaching the end of the finFET era, but this architecture will soon give way to gate-all-around architectures at 3nm and 2nm.  As the cost to design at these nodes increases drastically, there is growing interest in other design and integration approaches, such as chiplets. The concept of chiplets caters to the need for smaller, reusable dies through advanced packaging techniques. This surge in chiplet integration is driving 2.5D and 3D packaging growth by players like Intel, TSMC, AMD, NVIDIA, and Samsung. High-performance packaging platforms, like Si Interposers and Hybrid Bonding, play a crucial role in various applications.

Achronix, Advanced Micro Devices (AMD), Alibaba Group, Ambarella, Ambient Scientific, Amlogic, Ampere Computing, Apple, Anaflah, AONdevices, Arm, Atos, Amazon Web Services (AWS), Axera, Azure Engine, Baidu, Biren Technology, Bluetrum, Blumind, Broadcom, Cambricon Technologies, Canaan, Cerebras, Cisco, Clouder, Compal, Corigine, Corerain Technologies, Cray, Dayu, Dell, Deezer, Digital Reality, Dell, Denglin, Electronic Arts, Enflame, Equinix, Epic Semiconductors, Esperanto Technologies, Fulhan, Fujitsu, Fungible, Global Foxcom, GlobalFoundries (GF), Google, Gowin, GrAI Matter Labs, Graphcore, Groq, Gyrfalcon technology, HiSilicon, Hitachi, Hewlett Packard Enterprise (HPE), Hjmicro, Huawei, Hygon, IBM, Iluvatar CoreX, Intel, Inventec, InspireSemi, Inspur, Jaguar, jinghjia Micro, Kalray, Knuedge, Lattice Semiconductor, Lenovo, Lightelligence, LG, Lightmatter, LiSuan Tech, Loongson Technology, Luminous computing, Lynxi, Marvell technology, MediaTek, Mellanox, Meta, Microchip, Micron, Microsoft Azure, Moffett AI, NebulaMatrix, NEC, NetApp, Netflix, Neuroblade, NTT Communications, Nuovoton, Nuvia, Nvidia, NXP, Oracle, Optalysys, Penguin Computing, Pensando, Perceive, Pezy Computing, Phytium, Qilingxin, Quanta Cloud Technology (QCT), Qualcomm, Quality Technology Services (QTS), Quanta Computer, Quillion, Rackspace, Renesas, Resnics, Rivai, Rockchip, SambaNova, Samsung, Sabey Data Centers, SAP, Semiconductor Manufacturing International Corporation (SMIC), Semron, SiPearl, SK Hynix, Socionext, SocNoc, Sony, St Microelectronics, SuperMicro, Synaptics, Syntiant, Tachyum, T-Head, Taiwan Semiconductor Manufacturing Company (TSMC), Tencent, Tenstorrent, Tesla, Texas Instruments, Tower Semiconductor, Toshiba, Twitter, United Microelectronics Corporation (UMC), UniSOC, Untether AI, Xilinx, Xmos, Wave Computing, Weibo, Ysemi, Yunsilicon, Yusur, and more

Key Features 

• Description of technical trends, scaling roadmaps, and players’ dynamics with a special focus on China.
• Overview of the advanced packaging and memory innovation for processors
• Breakdown of the processor market from applications and processor type point of view, detailing present and future processor needs for servers, smartphones, personal computers, wearables, other home consumers’ end-systems, and vehicles.
• Mapping of the processor ecosystem, analysis of M&A, start-ups fundraising and list of noteworthy news.
• Overview of processor technology evolution for main technologies, as well as new technologies

Product objectives : 

Leveraging sound expertise in processor technologies and related markets, Yole is glad to provide you with this new report, ‘Status of the Processor Industry’, offering the broadest overview of the semiconductor processor industry.

The main objectives of this report are as follows:

•  Provide a comprehensive overview of the processor market:
  • CPU, GPU, APU, SoC FPGA, AI ASIC, and DPU market trends, including revenue and volume forecasts. Analysis of the main market trends and drivers by market, for the different processor technologies:
    • Consumer – Mobile
    • Consumer – PC
    • Consumer – Home & Wearables
    • Automotive
    • Data center
• Present technology trends:
  • Current and future developments, by type of processor (CPU, GPU, APU, AI ASIC, DPU, SoC FPGA)
  • Processor advanced packaging technology trends
  • Chiplet focus
  • Memory trends
  • IP overview
  • Transistor scaling and Moore’s law discussion
  • Next-gen computing
• Describe the supply chain and the processor ecosystem:
  • Recent news on the processor industry
  • Deep mapping of processor companies, by type of processor
  • Fundraising analysis of processor start-ups.
  • Financial analysis of the top 10 processor companies involved in APU, CPU, and GPU business.
  • Analysis of the Chinese processor ecosystem
  • US-China trade war overview and consequences on the processor industry