For the first time, a single semiconductor company is projected to have revenues of over $200bn.
Demand for AI infrastructure and accelerated computing as well as datacentre networking is fuelling the revenue expansion.
IDC forecasts that the compute segment of the semiconductor market will grow 36% to $349bn for 2025 with a 12% five-year CAGR through 2030.
Semiconductor demand for datacentre networking and wired/wireless infrastructure is projected to grow 13% in 2025, as cloud providers, telcos and enterprises upgrade networks to support AI workloads and low-latency services.
The rapid adoption of AI workloads has created a performance bottleneck in data movement rather than compute, driving hyperscalers and enterprises to accelerate investments in networking semiconductors.
Growth will be led by networking chips and optical interconnects. Networking chips such as high capacity ethernet switches, SmartNICs and DPUs that offload networking tasks from CPUs and GPUs enable greater efficiency in AI training and inference.
After experiencing softness in 2024 due to excess inventory buildup, the automotive and industrial semiconductor markets are projected to gradually recover in 2025.
In the automotive semiconductor market, several leading suppliers reported sequential growth amid normalisation of customer inventories, especially in China. However, companies remain cautious heading into the second half of 2025 due to expiration of subsidies in China, pricing pressure across the supply chain, continued customer destocking and trade-related uncertainty.
The automotive semiconductor market remains supported by rising content per vehicle, adoption of SiC and GaN for electrification and power and the shift towards domain and zonal controllers, and the software-defined vehicles. IDC forecasts the automotive semiconductor market will grow 3% in 2025.
The industrial semiconductor market recovered in the first half of 2025 with broad-based signs of recovery with the key industrial semiconductor suppliers reporting sequential growth, backlog visibility and return to growth. Drivers of industrial semiconductor market growth include military, aerospace, manufacturing, edge AI and the longer-term electrification trend. Macroeconomic uncertainty and cautious capex remain headwinds. IDC forecasts growth of 11% for 2025, up from a decline of 13.9% in 2024.
The wireless semiconductor market is forecast to grow modestly by 5%, supported by increased content rather than unit growth. Semiconductor content per device continues to increase with the adoption of 5G penetration, AI-enabled features and richer multimedia capabilities. ASPs are rising as OEMs integrate NPUs, GPUs and connectivity to support on-device AI.
“Markets that declined in 2024 such as automotive and industrial are only now starting to recover,” says IDC’s Nina Turner.
“IDC forecasts that the semiconductor market will become a trillion-dollar market by 2028,” says IDC vice-president Mario Morales.
