Apple, Lenovo among top 10 spenders on semiconductors

An IHS report shows China OEMs and Apple are rapidly increasing outlay for semiconductors.

Spending in the semiconductor market is shaking up large OEMs, especially in China. Procurements grew 25 percent in 2015 among companies such as Apple, Lenovo, Huawei and Xiaomi, which broke into the top 10 for the first time, according to a report from IHS. The major OEMs in this space were all found to be big spenders. Lenovo's growth in this area was spurred by its acquisition of Motorola Mobility from Google and IBM's x86 server business. This moved Lenovo closer to the second-biggest spender as Samsung contracts. Korea companies Samsung and LG are expected to reduce semiconductor outlay by 8.9 percent and 2.4 percent, respectively.

Wireless communications is expected to be the biggest market for semiconductors for the next few years. In 2015, it made up 33 percent, followed by computer platforms at 17.9 percent and consumer markets 15.9 percent. Those with positive growth are expected to be the industrial sector at 4.4 percent, wireless communications at 3.6 percent, computer peripherals at 1.9 percent and automotive at 0.5 percent. IHS concluded that all other application markets will see a decline.

While wireless communications is the key application base, it is eclipsed in revenue by the logic and memory IC segments that pulled in $75.5 billion and $62.1 billion in 2015. Microcomponent ICs and discretes are the only components segments found to be on the decline, with revenue sliding 4.8 percent and 5.1 percent. Others saw flat or single-digit growth.

Semiconductors are seen as vital investments for high-technology companies, especially in the mobile age. Wireless technology is a major catalyst for new spending among China companies. Huawei and Xiaomi have experienced massive growth in their handset businesses over the last few years. This will be a critical area of focus as China manufacturers seek to improve their standing in the semiconductor industry.

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