Intel knocked off global chip revenue top spot after rotten 2024

Eight out of the top ten semiconductor vendors recorded healthy revenue growth last year, fueled by burgeoning GPU and AI processor sales to datacenter customers. Intel and Infineon were the notable exceptions.

This is according to Gartner's estimations for the worldwide semiconductor market, which adds more weight to the sense that 2024 was an annus horribilis for Chipzilla. The Santa Clara-based chipmaker was pushed into second spot in the global sales rankings behind Samsung, and has SK hynix and Nvidia coming up fast behind it.

"Graphics processing units (GPUs) and AI processors used in datacenter applications (servers and accelerator cards) were the key drivers for the chip sector in 2024," said Gartner VP analyst George Brocklehurst.

"The rising demand for AI and generative AI (GenAI) workloads led datacenters to become the second-largest market for semiconductors in 2024, behind smartphones. Datacenter semiconductor revenue totaled $112 billion in 2024, up from $64.8 billion in 2023."

Samsung was propelled to the top spot thanks to a strong rebound in memory prices. In fact, the biz recently boasted of record Q4 revenue due to increased sales of high-bandwidth memory (HBM) and high-density DDR5 for servers. For the whole of 2024, it racked up $66.5 billion in revenue, climbing 62.5 percent on the previous year, Gartner said.

As for Intel, semiconductor revenue was basically flat at just 0.1 percent growth in 2024, leading to revenue of just under $49.2 billion*. Gartner attributed this to the limited success of Intel's own AI accelerators and modest growth in its core x86 business during the year.

The former unstoppable champ of the chip industry has had a tough time lately as it struggles to restructure and get its silicon roadmap back on track. The past year saw it wave goodbye to chief executive Pat Gelsinger following a $16.6 billion loss in Q3, said to be the largest in the company's history.

To make things worse, the chipmaker has just shelved plans to bring its next-gen GPU architecture, codenamed Falcon Shores, to market.

Behind Intel is GPU maker Nvidia, which has jumped two places in the rankings thanks to its semiconductor revenue expanding by 84 percent during 2024, reaching a total of $46 billion.

Memory maker SK hynix took the fourth position owing to "prolonged strong demand" for AI memory chips, and in particular the company's HBM tech used in GPU accelerators such as those produced by Nvidia, as we reported earlier this month.

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• Intel sued again over struggling foundry business

Infineon found itself at the bottom of the top ten. The German semiconductor biz, which makes chips for the automotive, industrial, and consumer sectors, reported revenue of $16 billion, down 6 percent from the previous year.

According to Gartner, memory revenue saw a 71.8 percent revenue growth during the past year, with this category now representing a quarter of all semiconductor sales.

DRAM and NAND flash revenue both increased more than 75 percent year-on-year, while HBM production "contributed significantly" to the top line of DRAM vendors that produce it.

And this situation looks set to continue in 2025 as the AI bandwagon rolls on. In particular, revenue for highly prized HBM silicon is expected to leap 66.3 percent during 2025, reaching $19.8 billion.

"Memory and AI semiconductors will drive near-term growth, with HBM projected to account for an increasing share of DRAM revenue, reaching 19.2 percent in 2025," Brocklehurst forecasts. ®

Bootnote

*Eagle-eyed Reg readers will have noticed that Gartner's estimate for Intel 2024 revenue differs from the company's own figure of $53.1 billion.