Japanese media: The first throne in the semiconductor industry changed hands after 24 years

[Global Technology Reporter Wang Huan] According to the "Nihon Keizai Shimbun" reported on July 31, in the April-June period of 2017, the world's semiconductor market has changed for the first time in 24 years. On July 27th, Intel of the United States announced that its consolidated operating revenue for April-June 2017 will grow by 9% year-on-year, which is lower than the semiconductor sector of South Korea’s Samsung Electronics, which has grown by 47%. Samsung’s strong performance in semiconductors for server storage media may also maintain its leading position in 2017.

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Intel’s consolidated operating income reached approximately US$14.8 billion (approximately 1.66 trillion yen). Samsung's semiconductor division is about 1.75 trillion yen. In terms of operating profit, Samsung exceeded Intel in January-March, but it surpassed operating income for the first time.

Intel's CPU-based (central processor) business model, known as "Intel Inside," is slow to transition. In addition to Samsung’s smart phone DRAM and flash memory, Samsung’s semiconductor orders have also grown due to “big data” demand. In order to further increase production, Samsung implemented approximately 1.25 trillion yen from January to June, and invested approximately 3 times in equipment investment in the same period of last year.

According to the US survey company, Gartner, the world semiconductor market reached 344.5 billion U.S. dollars in 2016 and is expected to grow by about 30% by 2021 to reach 431.7 billion U.S. dollars. In addition to the top two companies in the current share market, Qualcomm and South Korea's SK Hynix also have a long-standing advantage over the Japanese companies in the 1990s. Samsung, who was still in seventh place in 1993, seized the demand momentum and jumped to the top in one move. In the future, companies that dominate new areas like autopilot will expand their market share.

In terms of total market value, Intel is approximately 18 trillion yen, and Samsung is approximately 35 trillion yen, which has nearly doubled the gap. In addition, Taiwan's TSMC, the world's largest semiconductor foundry, also reached about 20 trillion yen, surpassing Intel. The separate division of design and manufacturing in the semiconductor industry is also advancing. Under this background, it is increasingly difficult to see through the value of the company's business revenue alone.