Market research and advisory firm Gartner said the worldwide semiconductor revenue is forecast to decline by 0.9 per cent in 2020. According to the company, the major reason for the dip is the impact of the corona virus on semiconductor supply and demand.

“The widespread COVID-19 across the world and the resulting strong actions by governments to contain the spread will have a far more severe impact on demand than initially predicted,” said Mr. Richard Gordon, research practice vice president at Gartner.

“This year’s forecast could have been worse, but growth in memory could prevent a steep decline,” added Mr. Richard.

The overall, 2020 global semiconductor revenue has been reduced from the previous quarter’s forecast by $55 billion, to $415.4 billion. In 2020 the total market growth has been reduced from 12.5 per cent to a decline of 0.9%, with nonmemory expected to decline 6.1 per cent, while memory is forecast to grow 13.9 per cent.

Further, Gartner said, in the year 2020 the semiconductor memory revenue will account for 30 per cent of the total worldwide semiconductor market. The memory market is forecast to reach $124.7 billion in 2020, an increase of 13.9 per cent, while the nonmemory revenue market is on pace to total $290.6 billion, a decline of 6.1 per cent year over year.

“NAND flash supply will remain historically low in 2020 due to fab delays and technology transitions, but the demand will diminish later in 2020,” said Mr. Richard.

Strong demand from cloud service providers in the first half of 2020 will push pricing and revenue higher in server DRAM. However, this growth will be more than offset by weak demand and falling prices from the smartphone market.