Technology

Global semiconductor sales top half a trillion dollars for first time as chip production gets boost

Server chip Yitian 710, developed by Alibaba’s in-house semiconductor unit T-Head, on display during the Apsara Conference 2021 on Oct. 19, 2021 in Hangzhou, China.
Xu Kangping | Visual China Group | Getty Images

Global semiconductor sales topped half a trillion dollars for the first time, as companies ramped up production to meet demand amid a worldwide chip shortage, a top industry association said.

In 2021, global semiconductor industry sales reached a record $555.9 billion, up 26.2% year on year, the U.S.-based Semiconductor Industry Association (SIA) said on Monday.

The industry shipped a record 1.15 trillion semiconductor units last year.

“In 2021, amid the ongoing global chip shortage, semiconductor companies substantially ramped up production to unprecedented levels to address persistently high demand, resulting in record chip sales and units shipped,” said John Neuffer, SIA president and CEO.

“Demand for semiconductor production is projected to rise significantly in the years ahead, as chips become even more heavily embedded in the essential technologies of now and the future.”

The global chip crunch hit industries across the board from consumer electronics to automakers, and companies became unable to deal with the demand for and shortage of products.

It has also led to governments and lawmakers around the world scrambling to secure chip supplies and invest to bring manufacturing of semiconductors closer to home.

Last year, U.S. President Joe Biden earmarked $50 billion for semiconductor manufacturing and research as part of a $2 trillion economic stimulus package. A bill known as the CHIPS for America Act is also working its way through the legislative process and aims to provide incentives to enable advanced research and development and secure the supply chain.

This month, the European Commission, the executive arm of the EU, announced a new European Chips Act that will enable 15 billion euros ($17.11 billion) in additional public and private investments until 2030.

Semiconductors sales in China totaled $192.5 billion in 2021, up 27.1% year on year, eclipsing any other market, the SIA said.

China has been focusing on boosting its domestic chip industry over the last few years amid geopolitical tensions with the United States. Beijing has made increasing self-sufficiency in semiconductors a priority, though China remains heavily reliant on foreign technology.

The market in the Americas saw the largest sales increase of 27.4% in 2021. Europe followed with 27.3% growth.

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