Consolidation continues to rewrite chip vendor rankings

The semiconductor industry increased 2.6 percent in 2016, but the top 25 vendors posted a combined 10.5 percent.

The largest chip vendors buoyed the semiconductor industry's growth rate even more than usual in 2016 as an unprecedented wave of consolidation continued to roil the rankings of the top 25 firms, according to an analysis of sales data by market research firm Gartner Inc.

Gartner concluded that global semiconductor sales reached $343.5 billion last year, an increase of 2.6 percent compared to 2015. The growth rate is higher than that estimated by other market watchers previously, including the World Semiconductor Trade Statistics organization, which said in February that industry sales rose by 1.1 percent.

The top 25 vendors, however, grew sales by a combined 10.5 percent in 2016, according to Gartner, and accounted for nearly 75 percent of total market share. By contrast, the rest of the semiconductor vendors saw their revenue declined by 15.6 percent, Gartner said.

The relative growth of the top 25 vendors compared to the rest of the market is skewed by the high degree of merger and acquisition activities that took place in 2015 and 2016, according to James Hines, a research director at Gartner.

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