Modest economic improvements and new applications such as wearable systems and Internet of Things are expected to result in more normal growth rates of O-S-D over the next five years.
Overall demand for optoelectronics, sensors, actuators, and discrete semiconductors softened in 2015 as the fragile global economy weakened, but these market segments are expected to stabilize in 2016 and gradually return to more normal growth rates in the second half of this decade, according to IC Insights’ new 2016 O-S-D Report—A Market Analysis and Forecast for Optoelectronics, Sensors/Actuators, and Discretes. The 360-page report shows combined O-S-D sales growing 5% in 2016 to a new record-high $70.2 billion, after increasing just 3% in 2015 to the current annual peak of $66.6 billion. O-S-D revenues accounted for nearly 19% of the semiconductor industry’s $353.7 billion sales total in 2015 versus about 81% coming from ICs (Figure 1), according to IC Insights’ newly released report.
Figure 1
Total O-S-D revenues continued to outgrow the larger integrated circuit market, which dropped 1% last year to $291.5 billion, primarily because of the weak global economy and a 3% decline in memory IC sales. O-S-D’s share of 2015 semiconductor sales was the highest it has been since 1988. IC Insights expects the O-S-D marketplace to account for 20.0% of total semiconductor sales in 2020.
On the strength of optoelectronics and sensor products—including CMOS image sensors, high-brightness light-emitting diodes (LEDs), and devices built with microelectromechanical systems (MEMS) technology—total O-S-D sales have outpaced the compound annual growth rate (CAGR) of ICs since the mid-1990s. IC Insights’ new report shows this trend continuing in the next five years. The 2016 O-S-D Report says modest improvements in the global economy, steady increases in electronic systems production, and new end-use applications—such as wearable systems and connections to the Internet of Things (IoT)—are expected to collectively lift the three O-S-D market segments by a CAGR of 6.5% between 2015 and 2020 compared to a projected 4.9% annual growth rate for IC sales in the second half of this decade.
During 2015, the O-S-D marketplace was a mixed bag of double-digit growth in most optoelectronics products and sales declines in discretes and a number of large sensor categories. Optoelectronics sales grew 11% to a record-high $35.2 billion in 2015 while the discretes market suffered its worst decline since the 2009 semiconductor downturn year, falling nearly 8% to $21.2 billion, says the new O-S-D Report. The sensors/actuators market increased about 4% in 2015 to a record-high $10.2 billion, with steep price erosion in accelerometers, gyroscope devices, and magnetic-field sensors dragging down overall growth in this semiconductor segment, according to the report. In 2016, optoelectronics sales are expected to increase 9% to $38.2 billion, while sensors/actuators revenues are forecast to rise again by 4% to $10.6 billion, and the commodity-filled discretes market is projected to grow just 1% this year. Between 2015 and 2020, all three O-S-D market segments are forecast to expand by more normal annual dollar-sales growth rates—with optoelectronics rising by a CAGR of 8.3%, sensors/actuators increasing at a rate of 5.6%, and discretes being up by a CAGR of 3.5% (Figure 2).
Figure 2
Report Details: The 2016 O-S-D Report
In a one-of-a-kind study, IC Insights continues to expand its coverage of the semiconductor industry with detailed analysis of trends and growth rates in the optoelectronics, sensors/actuators, and discretes market segments in its newly revised 360-page O-S-D Report—A Market Analysis and Forecast for the Optoelectronics, Sensors/Actuators, and Discretes.
