Semiconductor Packaging Market Size

Semiconductor Packaging Market Analysis

The Semiconductor Packaging Market size is estimated at USD 47.22 billion in 2024, and is expected to reach USD 79.37 billion by 2029, growing at a CAGR of 10.95% during the forecast period (2024-2029).

Advanced packaging can help achieve performance gains by integrating multiple chips in a package. By connecting these chips using fatter, such as through-silicon vias, interposers, bridges, or simple wires, the speed of signals can be increased, and the amount of energy required to drive those signals can be reduced. Additionally, advanced packaging allows for mixing components developed at different process nodes.

• The advanced packaging (AP) industry is currently going through a fascinating phase of significant progress. As Moore's Law slows down and the advancement of devices under 2nm nodes gains significant research and development investments from industry leaders such as TSMC, Intel, and Samsung, advanced packaging has become a valuable tool for enhancing product value.
• The development of electronic hardware necessitates the utilization of computing power that is capable of delivering high performance, high speed, and high bandwidth, as well as low latency and power consumption. Additionally, the hardware must be able to provide a wide range of functionalities, as well as be able to integrate at the system level, and must be cost-effective. Advance packaging technologies are ideally suited to meet these diverse performance demands and the intricate heterogeneous integration requirements, thus providing businesses with the opportunity to capitalize on the changing demands of high-performance computing, artificial intelligence, and 5G.
• Major semiconductor packaging vendors are experiencing significant growth in sales owing to increasing demand for high-performance computing, IoT, and 5G devices. For instance, Amkor's computing segment, which includes data center, infrastructure, PC/laptop, and storage, registered a 20% share in the total revenue, up from 18% in Q2 2022. The shift toward vehicle electrification is being accelerated by the implementation of policies by governments around the world to reduce emissions and encourage sustainable transportation.
• A significantly high initial investment is required in the designing, developing, and setting up of semiconductor packaging units as per the requirements of different industries such as automotive, consumer electronics, healthcare, IT & telecommunication, and aerospace and defense. This can restrict the growth of the semiconductor packaging market.
• The COVID-19 pandemic forced manufacturing industries to re-evaluate their traditional production processes, primarily driving digital transformation and smart manufacturing practices across the production lines. According to the Semiconductor Industry Association, in 2023, semiconductor sales were expected to reach USD 515.1 billion worldwide. Semiconductors are crucial components of electronic devices, and the industry is highly competitive. The year-on-year decline rate in 2023 was 10.3%, although a swift recovery is expected in 2024. Notable semiconductor chip makers include Intel and Samsung Electronics, with Intel generating USD 58.4 billion and Samsung generating USD 65.6 billion in semiconductor revenue in 2022, placing them among the largest companies in terms of semiconductor industry revenues.