In year 2019, the American giant chip maker company namely, Inter Corporation has taken the number one position from Samsung Electronics. The sales of Samsung’s semiconductors have declined by 29% in 2019 as compared to $78.5 billion in the last year. On the other hand, as compared to 2018. The sales of semiconductors for Intel Corporation in the year 2019 have not shown a significant decline. It stood at $69.8 billion. The meager revenue decline of 0.7% for Intel seems to be negligible. When compared with 11.6% of the worldwide decline in the server market in the 2nd quarter of 2019. As reported by International Data Corporation.
Despite, the decline in Samsung Electronics sales. It has been able to capture almost 13% of the market share in 2019. This decline in Samsung can be attributed to the overall decline in the memory market. Further, the report of Gartner Incorporation, a leading research and advisory company has indicated that it is not the Samsung only. Who faced a decline but in fact, its overall industry in memory sector. Who is dealing with this situation because of oversupply and tumbling prices of dynamic random access memory and nonvolatile storage memory. So, Samsung makes 82% of its revenue by selling its memory chips. Its sale has shown a significant 34% decline in memory category.
Moreover, the report has indicated the total revenue in 2019 of the semiconductor market accounted for almost $418 billion. Which was 12% lower than the last year’s total revenue of the semiconductor market. The total share of the memory market for overall revenue of semiconductors was approximately 27% and it has declined by 31.5% in 2019.
The Andrew Norwood, who is an analyst at Gartner has suggested that majorly cause of the decline in semiconductor was essentially because of a sudden fall in demand of the hyper-scale market which lead to an oversupply of semiconductors in the market. Precisely, Andrew Norwood stated:
“Excessive inventory at DRAM vendors in the second half of 2019 pushed prices lower and resulted in an average selling price (ASP) decline of 47.4% in 2019”
For this year. Andrew Norwood has predicted that revenue of semiconductor market will rise. As the demand and supply reach to its usual equilibrium. Which will automatically lead to an increase in the average selling price of memory-related products.