21 Microchip Industry Statistics, Trends & Analysis

The microchip industry is directly associated with the semiconductor industry. Many of the statistics of these two industries are the same as the microchips are used to create the semiconductors. Some even use the term interchangeably, which can add some confusion to the reporting data that is received.

In general terms, the microchip industry sees large fluctuations in its product supply or demand. Because it is a product that is usually purchased with disposable income, it rises or falls based on the current strength of the global economy.

There are two ways to be a producer in this industry. A company can be large enough to operate its own fabrication facilities for integrated devices. It can also outsource that need to an agency which already has the installed capacity to produce microchips for products. Companies without integrated operations usually see higher profit levels that stay more consistent when compared to companies with integrated operations.

Interesting Microchip Industry Statistics

#1. The total amount of sales for global microchips in 2017 was $409 billion. Memory components within the global microchip segment accounted for over $122 billion of the total revenues generated. (Statista)

#2. The current microchip market in North and South America has an estimated value of $86.46 billion. In the United States, more than $50 billion in microchips and related devices was imported in 2017. (Statista)

#3. More than 479 million graphics microchips were sold in 2017 globally. Out of this figure, Intel has a 76% market share. Intel, on its own, generates nearly $60 billion in revenues every year. (Statista)

#4. Capital equipment spending for the global microchip industry is about $40 billion each year. (Statista)

#5. Firms with headquarters in the United States have the largest share of the global market for microchips, as measured by sales in 2015. 50% of the Top 20 companies are based in the U.S., including companies like Intel, Texas Instruments, Apple, Micron, and Qualcomm. (Congressional Research Service)

#6. Integrated circuits make up the majority of industry sales. In 2015, it accounted for an 82% market share. The remainder of the market is found in the O-S-D market, or optoelectronics, sensors, and discretes. (Congressional Research Service)

#7. Logic devices are the most common product sold by the industry, accounting for 27% of the total market. Memory devices make up a 23% share, while microprocessors are about 18% of the total market. (Congressional Research Service)

#8. Outside of the Americas, in 2017, China held a 22.2% market share of the industry. Europe had a 17.1% share, while Japan held a 13.3% market share. In the Americas, the microchip industry saw a 41% increase in sales from the year before. (Semiconductor Industry Association)

#9. Almost 90% of the fabrication work for microchips occurs outside of the United States. (Congressional Research Service)

#10. In the U.S., there were about 820 firms involved in microchip manufacturing as of 2013. These firms contribute an added value to the economy of about $30 billion each year. That would make the microchip industry responsible for about 1% of total U.S.-based manufacturing. (Congressional Research Service)

#11. From 2005-2015, price changes within the microchip industry have forced manufacturers and producers to look for new markets and products. Prices, when adjusted for performance and quality, have declined by 46%. (Congressional Research Service)

#12. Microchip manufacturers in the United States devote about $1 out of every $5 they earn in profits toward new research and development. In comparison, the rate of research and development investment by all manufacturing industries in 2012 was just 3.6%. (Semiconductor Industry Association)

#13. The microchip industry in the United States currently employs about 180,000 workers directly. These figures are down almost 40% from 2001 employment numbers. About 1.5% of all manufacturing jobs in the United States come from the microchip industry. (Bureau of Labor Statistics)

#14. Workers in the microchip industry in the U.S. earned an average wage of over $138,000 in 2015. That wage was more than double the average wage of manufacturing workers in the United States that year. (Bureau of Labor Statistics)

#15. About 25% of all microchip manufacturing positions in the United States are based in California. Six other states, when combined with California, make up a substantial share of the overall industry: Idaho, New York, Arizona, Massachusetts, Oregon, and Texas. (Congressional Research Service)

#16. About 75% of the world’s microchip fabrication capacity is installed in Taiwan, China, Japan, and South Korea. South Korea and Taiwan together account for half of the global installed capacity. The United States accounts for a total of 13% of the capacity. (Congressional Research Service)

#17. Intel conducts up to 70% of its wafer fabrication needs within the United States, specifically at its facilities that are located in Chandler, AZ, Albuquerque, NM, and Hillsboro, OR. (Congressional Research Service)

#18. Foreign sales accounted for 83% of the total market for microchip companies that are based in the United States. Taiwan, South Korea, China, Malaysia, and Mexico are the most popular destinations for U.S.-based microchip exports. (Congressional Research Service)

#19. About 1 out of every 3 microchips that is exported from the United States is re-exported by the country receiving the product. Microchips may actually cross several different borders before being incorporated into a specific product. (Congressional Research Service)

#20. The microchip industry is perennially one of the top-ranked receivers of corporate patents in the United States. In 2015, Qualcomm received 2,900 patents related to the industry. Intel followed with 2,046 patents, while Broadcom received 1,086 patents. (U.S. Patent and Trademark Office)

#21. In 2014, 57% of the consumption of integrated circuits occurred in China. Despite this fact, up to 80% of the microchips that are used in Chinese manufacturing processes are believed to be imported. (Congressional Research Service)

Microchip Industry Trends and Forecast

The trends within the microchip industry, as in the semiconductor industry, are based on the current economic cycle. Countries that are growing economically and have a strong GDP will engage with this industry more often and account for more sales. Countries facing a weaker economy tend to cut ties with the industry until their revenues can stabilize once again.

That makes the revenues somewhat unpredictable within the microchip industry. Sales can rise immediately, as seen in the United States in Q1 2018, in unexpected ways. They can also drop dramatically, as seen during the various economic crises experienced in 2007-2009.

Just about every modern device carries microchips. There will always be a certain strength in this industry, especially as technologies continue to evolve. People want the latest smartphone model. They want new computers. With microchips being included in more products every year, there are always opportunities to explore within this unique industry.