January 10, 2012 – Reaffirming its earlier assertions about the health of fabless & foundry chipmakers vs. the rest of the industry, IC Insights says fabless IC suppliers saw sales rise 6% in 2012, compared with a -4% decline by IDMs (those with their own IC fabs), and the overall market’s -2% decline for the year.

Since 1999, the firm tracks, fabless company IC sales have outpaced IDMs (or the decline has been less severe) in every year except 2010. That year was an outlier largely because of strength in DRAM and NAND flash memory, areas in which fabless companies don’t have a presence, the firm points out.

Fabless vs. IDM company sales, 1999-2012. (Source: IC Insights)

Since 1999, fabless IC sales started out as roughly 7% of IDM sales, but have steadily risen and now make up about 27% of total IC sales. And fabless IC market CAGR from 1999-2012 was 16% vs. the overall industry’s 5% CAGR. More comparison metrics: fabless IC sales are at levels 7× what they were in 1999, vs. 50% for IDM IC sales, and IDM IC sales are now only 10% higher than 2000 and actually lower than they were in 2007.

By 2017, fabless IC companies will command a full third of the total IC market, IC Insights predicts, and this could be easily attained especially if larger companies (e.g. IDT, LSI Logic, Agere, and AMD) become entirely fabless. "Over the long-term, IC Insights believes that fabless IC suppliers, and the IC foundries that serve them, will continue to become a stronger force in the total IC industry," the firm notes.

These statistics are part of IC Insights’ annual McClean Report analysis of the entire IC industry, from technologies to applications. The firm is holding half-day seminars this month to release and discuss the findings. Contact the firm for more information about the report and the seminars.