A study found that global semiconductor market revenue hit a "record high" in the third quarter of this year. The market expansion was driven by Nvidia, which supplies artificial intelligence (AI) chips, and the three memory makers that produce high-bandwidth memory (HBM) — Samsung Electronics, SK hynix, and Micron. However, revenue growth was not significant in sectors excluding these companies. Some say the semiconductor market will enter a "great transition" as uncertainty grows due to the entrenchment of an "imbalance" in which growth is concentrated only in AI and due to supply chain restructuring, and that preparations are needed.
According to market research firm Omdia on the 12th, global semiconductor market revenue in the third quarter rose 14.5% from the previous quarter to $216.3 billion (about 318.437 trillion won), setting a record high. This is the first time global semiconductor market revenue has topped $200 billion in a single quarter. Nvidia, Samsung Electronics, SK hynix, and Micron accounted for 40% of total semiconductor market revenue.
With the expansion of AI services, the semiconductor market that powers them has entered a "supercycle." Revenue grew 8% in the second quarter from the prior quarter, and conditions improved further in the third quarter. Omdia projected that if this trend continues, global semiconductor market annual revenue this year could exceed $800 billion (about 1,177.44 trillion won), up about 20% from the previous year.
In the third quarter, the semiconductor market grew so much that it outstripped not only earlier projections but also the traditional seasonal pattern. The semiconductor market has typically posted an average growth rate of around 7% in the third quarter each year compared with the previous quarter. The actual growth rate more than doubled that.
The global semiconductor market is currently showing an "AI concentration" phenomenon. Last year, the global semiconductor market grew more than 20% from the previous year to surpass $650 billion (about 957.515 trillion won). But excluding the results of Nvidia and the three memory makers, the growth rate stayed around 1%. This imbalance has somewhat eased this year, but AI and memory still led market growth. In the third quarter, the quarter-over-quarter growth rate for sectors excluding Nvidia and the three memory makers was around 9%, below the overall growth of 14.5%.
Ryno Zeng, a senior researcher at Omdia, said, "As AI moves into the inference domain, the increased workload has boosted demand not only for HBM but also for general-purpose DRAM, and an unusual short-term price rise is appearing," adding, "Semiconductor market revenue in the fourth quarter will also hit a record high." He added, "The strong growth is likely to continue into next year."
◇ "Uncertainty offers both risks and opportunities… corporations must maintain strategic flexibility"
In another report, Omdia forecast that the semiconductor market will enter a "great transition" starting next year. ▲ A clash between "geopolitical constraints" stemming from U.S.-China tensions and expanding export controls and "growth opportunities" from technological advances in AI, packaging, and memory ▲ As major governments around the world move to secure domestic semiconductor production capacity, the efficiency of the global supply chain built up over decades will decline ▲ An "imbalance" between traditional markets pressured by inventory, price, and demand uncertainty and the growing AI sector — Omdia analyzed that these factors will interact and could change the semiconductor market significantly.
The United States is seeking to "expand domestic semiconductor manufacturing" through the Chips Act implemented by the Joe Biden administration in 2022 and the tariff policies of the Donald Trump administration launched in 2025. Omdia said tariffs by the U.S. government could drive semiconductor wafer prices up 10% to 15% next year.
Along with expanding tariffs, the U.S. government is blocking major U.S. semiconductor corporations such as Nvidia, Intel, and AMD from exporting products to China. China, unable to secure advanced manufacturing equipment and semiconductors, is likewise pouring massive investment into developing domestic semiconductor technology. Omdia projected that by 2029, China's semiconductor self-sufficiency rate could reach 40%.
Technology is also expected to advance rapidly. TSMC, the world's largest foundry (contract chip manufacturing) company, currently derives about 60% of its revenue from the 5-nanometer (nm; 1 nm = one-billionth of a meter) and 3-nm nodes. Omdia assessed that mass production of the next-generation 2-nm process could start as early as within the year. Omdia also said Samsung Electronics, SK hynix, and Micron will further expand price premium strategies based on technological differentiation in high-performance DRAM such as DDR5 and HBM.
The solid-state drive (SSD) sector, where Korea holds more than 61% of the market, and the hard disk drive (HDD) segment, with a share of more than 87%, are also expected to continue strong growth. With AI expansion, the SSD market is projected to log a compound annual growth rate (CAGR) of 18.6% through 2029, while the HDD market is forecast to rise 16.6%.
Omdia also analyzed that as growth driven by these technological advances collides with expanding semiconductor regulations in each country, market uncertainty could grow. Still, Omdia projected long-term growth for the semiconductor industry, saying the market size could reach $1 trillion (about 1,500 trillion won) as early as 2028 and by 2030 at the latest. In the report, Omdia said, "Uncertainty offers both risks and opportunities to industry participants," adding, "Corporations that maintain strategic flexibility will be in a favorable position."