Silicon Content Peaking At 25%

The silicon foundry industry made 20% of the world’s chip production in 2022  for total foundry industry revenues of $10 billion, said Ross, ‘by 2010, the percentage of ICs manufactured in foundries will be in the 35-40% range.  By then, total foundry industry revenues will be around $40 billion.”

Ross added that TSMC believes growth of the world semiconductor industry will slow to 7-10 per cent CAGR, but the foundry business will grow at 20 per cent CAGR.

One of the reasons for slower growth in the overall semiconductor industry, according to TSMC, is that the value of the semiconductor content of electronic products will saturate at 20-25 per cent.

While, for the six years 1995 to 2001, the industry has run faster down the technology roadmap – with a new technology generation every two years instead of every three years – the industry has generated zero revenue growth, according to Ross. The industry’s revenues were the same in 2001 was they were in 1995.