Microprocessor Growth Will Slow in 2022 after Cellphone MPU Surge

Total MPU sales are expected to rise 7% this year with cellphone processors increasing 10% following a 31% jump in 2021; modest growth is seen in computer CPUs and embedded MPUs, says new 1Q update.

February 24, 2022 -- Total microprocessor sales in 2021 maintained strength, growing 14% to a record-high $102.9 billion after climbing 16% in 2020, when emergency lockdowns in the Covid-19 virus crisis drove up demand for personal computers and large-screen smartphones because of increased reliance on the Internet during the deadly pandemic, says the new February 1Q Update of IC Insights’ 2022 McClean Report service (Figure 1). Worldwide sales growth in total microprocessors is expected to slide back in 2022 to an increase of 7%, which will lift the MPU market to another record high of $110.4 billion, with unit shipments rising 6% to 2.6 billion processors, according to the 1Q22 update’s forecast.

Figure 1

The total microprocessor market hung on to double-digit percentage growth in 2021 primarily because cellphone processor sales surged 31% as users moved to faster smartphones, including those built with new fifth-generation (5G) cellular modems, more powerful cameras, and artificial intelligence (AI) machine-learning capabilities for automatic performance improvements. After cellphone application processor sales jumped to a record-high $35.0 billion in 2021, the growth rate is expected to decrease to 10% in 2022, which will lift this mobile microprocessor segment to revenues of $38.4 billion, based on IC Insights’ forecast. Tight supplies of leading-edge smartphone processors and continuous integration of more functions, acceleration units, powerful graphics, and high-speed 5G modems on these MPUs will increase the average selling price of units by 4% in 2022 after the ASP climbed 22% both in 2021 and 2020, says the new update report.

Sales growth in computer central processing unit (CPU) microprocessors slowed to a 4% increase in 2021 after rising 14% in 2020. Computer CPU growth eased back after strong demand slowed for personal and home computers once many consumers, businesses, and schools had bought new systems for remote working and at-home education in the first year of the Covid-19 virus crisis. Sales of computer CPU MPUs—including x86 processors sold by Intel and rival Advanced Micro Devices for traditional notebook and desktop personal computers—are forecast to rise by another 4% in 2022 to a record-high $50.5 billion.

Embedded microprocessor sales for a broad range of end-use systems—including industrial, communications, automotive, and Internet of Things (IoT)—are projected to grow 9% in 2022 to about $21.5 billion after increasing 11% in both 2021 and 2020.

IC Insights’ McClean Report service forecasts total MPU sales to increase by a compound annual growth rate (CAGR) of 5.3% between 2021 and 2026 to $133.3 billion. Cellphone application processor sales are projected to rise by a CAGR of 6.3% in the five-year forecast to $47.4 billion while computer CPU revenues are expected to grow by an annual rate of 3.7% to $58.1 billion in 2026. Embedded MPU sales are forecast to grow by the fastest five-year average in microprocessor market, increasing by a CAGR of 7.2% to reach $27.8 billion in 2026, says the new update.

Report Details: The 2022 McClean Report

The McClean Report—A Complete Analysis and Forecast of the Semiconductor Industry, is now available. A subscription to The McClean Report service includes the January Semiconductor Industry Flash Report, which provides clients with IC Insights’ initial overview and forecast of the semiconductor industry for this year through 2026. In addition, Quarterly Updates to the report will be released in February, May, August, and November of this year. An individual user license to the 2022 edition of The McClean Report is available for $5,390 and a multi-user worldwide corporate license is available for $8,590. The Internet access password and the information accessible to download will be available through November 2022.

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