OSAT Market Size & Share Analysis - Growth Trends & Forecasts (2023 - 2028)

The Global Outsourced Semiconductor Assembly and Test Services (OSAT) Market is Segmented by Service (Packaging and Testing), Type of Packaging (Ball Grid Array Packaging, Chip-scale Packaging, Stacked Die Packaging, Multi-chip Packaging, and Quad Flat and dual-inline Packaging), by Application (Communication, Consumer Electronics, Automotive, Computing & Networking, Industrial) and Geography.

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OSAT Market Size

OSAT Market Summary
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Study Period 2018- 2028
Base Year For Estimation 2022
CAGR 9.15 %
Fastest Growing Market Asia Pacific
Largest Market Asia Pacific
Market Concentration Low

Major Players

OSAT Market Major Players

*Disclaimer: Major Players sorted in no particular order
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OSAT Market Analysis

The outsourced semiconductor assembly and test services market size is estimated at USD 41.10 billion in 2023 and is expected to reach USD 63.67 billion by 2028, registering at a CAGR of 9.15% during the forecast period (2023-2028).

  • Outsourcing is also a major factor in the semiconductor industry. More than just design, the manufacturing aspect of semiconductor product development is dependent on the services provided by third-party vendors. Fabs (Pure-Play Foundries) and OSATs are two prominent examples of semiconductor outsourcing. OSAT semiconductor firms provide third-party integrated circuit (IC) packaging and testing services package and test semiconductor devices made by foundries before shipping them to the market. Such companies in the market provide innovative and cost-effective solutions that deliver faster processing speeds, higher performance, and functionality while taking up less space in an electronic device.
  • OSAT companies are mostly contracted by semiconductor design companies, such as Intel, AMD, and Nvidia, and execute those companies’ designs. For instance, Intel is both a chip designer and a foundry (wafer provider) owing to the fact that they own and operate their own fabs or foundries. Intel outsources its chip packaging to different OSATs for assembly and test services before shipping the chips to customers.
  • The semiconductor industry has been growing, with miniaturization and efficiency being the focus area and semiconductors emerging as building blocks of all modern technology. The advancements and innovations in this field have been directly impacting all downstream technologies. The rapid development of electronics technology, including artificial intelligence (AI) and cloud computing, is complemented by a high demand for integrated circuits (ICs) with high speed, low power consumption, and high integration, leading to its significant sales.
  • However, the significant downfall in demand for consumer electronics and declining demand for cloud services has negatively impacted the OSAT market leading to a decrease in the capacity utilization of many OSAT plants to about 50% in the first quarter of 2023. On the contrary, the introduction of advanced packaging technologies owing to the development of sophisticated electronics in both the consumer electronics and automotive sectors as well as demand for stock adjustment is expected to provide a moderate recovery of about 65% capacity utilization of OSAT in the upcoming quarters. Due to these factors, more recent semiconductor packaging technologies are being adopted to keep up with demand.
  • Although the market was severely affected by the COVID-19 pandemic, the demand for consumer electronics and computer components increased exponentially due to the enforcement of people working remotely.

OSAT Market Trends

Automotive Application Segment is Expected to Hold Significant Market Share

  • Automotive applications are one of the fastest-growing sources of demand for the OSAT market. As the complexity of automotive chips is growing with the advent of electric cars, autonomous vehicles, and advanced driver-assistance system (ADAS) systems, the complexity of automotive chip packaging is also increasing rapidly.
  • The semiconductor packaging industry is responsible for this wave of gains due to a variety of new technologies, including big data, high-performance computing (HPC), artificial intelligence (AI), edge computing, advanced memory, 5G infrastructure expansion, adoption of 5G intelligent mobile phones, growth in the use of electric vehicles, and improved car safety features, to name a few.
  • For instance, in-cabin applications such as infotainment controllers and ADAS have stringent mission-critical test requirements over wide operating temperature ranges, necessitating the need for OSAT vendors to step in. Advanced packaging technologies and a new generation of chips with high performance, reliability, and integration are made possible by packaging materials, which are essential to the growth of advanced technology applications.
  • The global millennial preference for automatic vehicles is anticipated to fuel the semiconductor packaging and testing demand. In an automatic car, there are more than 2,500 chips installed. Since it used to take longer to produce a single semiconductor a few years ago, reputable companies had to deal with a shortage of semiconductors.
  • According to IEA, Electric vehicles amounted to about 14 percent of global passenger car sales in 2022, a rise of around 5.3 percentage points year-over-year. Electric vehicle sales have rapidly increased since 2017, when they rose above one percent of the market, and have particularly accelerated since 2020. Due to increased environmental consciousness, many consumers started looking for more sustainable transportation methods amid the COVID-19 pandemic. This contributed to the EV market expansion worldwide.
OSAT Market: Electric Vehicles Market Share, in Percentage (%), Global, 2012 - 2022

South Korea is Expected to Hold Significant Market Share

  • South Korea is one of the promising markets for global OSAT vendors. The country is also home to some prominent chip makers for the consumer electronics segment, such as Samsung and SK Hynix, making it a lucrative hub for innovation in semiconductor devices.
  • The Korean government focuses on smart manufacturing and plans to have 30,000 fully-automated manufacturing companies by 2025. The government aims to achieve this by incorporating the latest automation, data exchange, and IoT technologies. This is expected to be a major driver for OSAT services in the country.
  • Moreover, the size of the country's semiconductor testing sector has grown significantly with the growth of Samsung Electronics' system semiconductor business. The semiconductor testing companies in the country, such as NEPES Ark, LB Semicon, Tesna, and Hana Micron, have been dealing with increased supplies of system semiconductors by making significant investments in necessary facilities and equipment.
  • The developments in the 5G space also led to the growth of advanced packaging of chips. According to the Ministry of Science and ICT, as of February 2023, the country has 29.13 million 5G Subscribers, an increase of 113% compared to 13.66 million 5G subscribers in February 2021.
  • Apart from this, the automotive maker Hyundai, one of the prominent automobile companies in South Korea, announced that it is planning to invest USD 21.56 billion over the next five years (2019-2023) in ADAS systems, electric cars, autonomous vehicles, and related technology, as its aim to push itself to catch up in this critical emerging technology. This is also expected to fuel the regional demand for automotive semiconductors.
OSAT Market: Total Number of 5G Subscriptions, in Million, South Korea, March 2022 - March 2023

OSAT Industry Overview

The outsourced semiconductor assembly and test services (OSAT) Market is highly fragmented, with the presence of major players like ASE Technology Holding Co. Ltd, Amkor Technology Inc., Powertech Technology Inc., ChipMOS Technologies Inc., and King Yuan Electronics Co. Ltd. Players in the market are adopting strategies such as partnerships, innovations, and acquisitions to enhance their product offerings and gain sustainable competitive advantage.

In June 2023, Amkor Technology Inc. announced that it has been working toward innovating advanced packaging to enable the car of the future. This is done owing to the dramatic evolution of the enhanced automotive experience over the past few years and the move toward advanced driver assistance systems (ADAS) and full autonomy, motivated by regional legislation and consumer preference.

In March 2023, Advanced Semiconductor Engineering, Inc. announced its most advanced Fan-Out-Package-on-Package (FOPoP) solution that is positioned under the ASE VIPack platform and has been developed to lower latency and deliver exceptional bandwidth advantages for the dynamic mobile and networking markets.

OSAT Market Leaders

  1. ASE Technology Holding Co. Ltd

  2. Amkor Technology Inc.

  3. Powertech Technology Inc.

  4. ChipMOS Technologies Inc.

  5. King Yuan Electronics Co. Ltd

*Disclaimer: Major Players sorted in no particular order

OSAT Market Concentration

OSAT Market News

  • June 2023: Powertech Technology Inc. announced that it was informed by Micron Technology of the latter's decision to acquire Powertech's assets in Xi'an, China. Micron is acting in accordance with the terms of the agreement it entered with Powertech in 2016, which states that Micron reserves the right to purchase Powertech's Xi'an factory after a 6-year service contract is fulfilled.
  • February 2023: Amkor Technology Inc. announced its strategic partnership with GlobalFoundries (GF) to enable a comprehensive EU/US supply chain from semiconductor wafer production at GF to OSAT services at Amkor’s site in Porto, Portugal. Under this agreement, GF plans to transfer its 300mm Bump and Sort lines from its Dresden site to Amkor’s Porto operations to establish the first at-scale back-end facility in Europe.

Outsourced Semiconductor Assembly And Test Services (OSAT) Market Report - Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Assumptions and Market Definition

    2. 1.2 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET INSIGHTS

    1. 4.1 Market Overview

    2. 4.2 Semiconductor Industry Outlook

    3. 4.3 Industry Attractiveness - Porter's Five Forces Analysis

      1. 4.3.1 Bargaining Power of Suppliers

      2. 4.3.2 Bargaining Power of Buyers

      3. 4.3.3 Threat of New Entrants

      4. 4.3.4 Threat of Substitutes

      5. 4.3.5 Intensity of Competitive Rivalry

    4. 4.4 Industry Value Chain Analysis

    5. 4.5 Assessment of the Impact of COVID-19 Pandemic on the Market

  5. 5. MARKET DYNAMICS

    1. 5.1 Market Drivers

      1. 5.1.1 Increased Applications of Semiconductors in Automotive

      2. 5.1.2 Advancement in Semiconductor Packaging Due to Trends like 5G

    2. 5.2 Market Restraint

      1. 5.2.1 Vertical Integration is one of the Significant Concerns of OSAT Players

  6. 6. MARKET SEGMENTATION

    1. 6.1 By Service Type

      1. 6.1.1 Packaging

      2. 6.1.2 Testing

    2. 6.2 By Type of Packaging

      1. 6.2.1 Ball Grid Array (BGA) Packaging

      2. 6.2.2 Chip Scale Packaging (CSP)

      3. 6.2.3 Stacked Die Packaging

      4. 6.2.4 Multi Chip Packaging

      5. 6.2.5 Quad Flat and Dual-inline Packaging

    3. 6.3 By Application

      1. 6.3.1 Communication

      2. 6.3.2 Consumer Electronics

      3. 6.3.3 Automotive

      4. 6.3.4 Computing and Networking

      5. 6.3.5 Industrial

      6. 6.3.6 Other Applications

    4. 6.4 By Geography

      1. 6.4.1 United States

      2. 6.4.2 China

      3. 6.4.3 Taiwan

      4. 6.4.4 South Korea

      5. 6.4.5 Malaysia

      6. 6.4.6 Singapore

      7. 6.4.7 Japan

      8. 6.4.8 Rest of the World

  7. 7. COMPETITIVE LANDSCAPE

    1. 7.1 Vendor Share Analysis

    2. 7.2 Company Profiles

      1. 7.2.1 ASE Technology Holding Co. Ltd

      2. 7.2.2 Amkor Technology Inc.

      3. 7.2.3 Powertech Technology Inc.

      4. 7.2.4 ChipMOS Technologies Inc.

      5. 7.2.5 King Yuan Electronics Co. Ltd

      6. 7.2.6 Formosa Advanced Technologies Co. Ltd

      7. 7.2.7 Jiangsu Changjiang Electronics Technology Co. Ltd

      8. 7.2.8 UTAC Holdings Ltd

      9. 7.2.9 Lingsen Precision Industries Ltd

      10. 7.2.10 Tongfu Microelectronics Co.

      11. 7.2.11 Chipbond Technology Corporation

      12. 7.2.12 Hana Micron Inc.

      13. 7.2.13 Integrated Micro-electronics Inc.

      14. 7.2.14 Tianshui Huatian Technology Co. Ltd

    3. *List Not Exhaustive

    4. 7.3 Vendor Share Analysis

  8. 8. INVESTMENT ANALYSIS

  9. 9. MARKET OPPORTUNITIES AND FUTURE TRENDS

**Subject to Availability

OSAT Industry Segmentation

OSAT are companies that offer third-party integrated circuit (IC) packaging and test services. These companies provide packaging for silicon devices that are made by foundries and test the devices prior to shipping. It mainly focuses on offering innovative packaging and test solutions for semiconductor companies in well-established markets such as communications and consumers, and computing, in addition to emerging markets in automotive electronics, the Internet of Things (IoT), and wearable devices.

The outsourced semiconductor assembly and test services (OSAT) market is segmented by service (packaging and testing), type of packaging (ball grid array packaging, chip-scale packaging, stacked die packaging, multi-chip packaging, quad flat & dual-inline packaging), application (communication, consumer electronics, automotive, computing & networking, industrial) and geography (United States, China, Taiwan, South Korea, Malaysia, Singapore, Japan, and the Rest of the World).

The market sizes and forecasts are provided in terms of value in USD for all the above segments.

By Service Type
Packaging
Testing
By Type of Packaging
Ball Grid Array (BGA) Packaging
Chip Scale Packaging (CSP)
Stacked Die Packaging
Multi Chip Packaging
Quad Flat and Dual-inline Packaging
By Application
Communication
Consumer Electronics
Automotive
Computing and Networking
Industrial
Other Applications
By Geography
United States
China
Taiwan
South Korea
Malaysia
Singapore
Japan
Rest of the World

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Outsourced Semiconductor Assembly And Test Services (OSAT) Market Research Faqs

The OSAT Market is studied from 2018 - 2028.

The OSAT Market is growing at a CAGR of 9.15% over the next 5 years.

The OSAT Market is valued at 41 Billion USD in 2018.

The OSAT Market is valued at 63 Billion USD in 2028.

Asia Pacific is growing at the highest CAGR over 2018- 2028.

Asia Pacific holds highest share in 2022.

ASE Technology Holding Co. Ltd, Amkor Technology Inc., Powertech Technology Inc., ChipMOS Technologies Inc., King Yuan Electronics Co. Ltd are the major companies operating in OSAT Market.

OSAT Industry Report

Statistics for the 2023 OSAT market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. OSAT analysis includes a market forecast outlook to for 2023 to 2028 and historical overview. Get a sample of this industry analysis as a free report PDF download.

OSAT Market Report Snapshots

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