SIA stated that the number for 2024 reached a new high, while the total for 2023 was $526.8 billion. John Neuffer, CEO of SIA, a lobbying group in the chip industry, stated in an interview with GamesBeat that the reason is undoubtedly the astonishing demand for AI processors and memory.

  The actual growth rate of 19.1% is higher than SIA's forecast of 13%, while the growth in 2024 is compared to the contraction of 8.2% in 2023. Due to artificial intelligence, there has been a significant fluctuation in demand. This is also one of the reasons why Nvidia has become one of the most valuable companies in the world (valued at $3.15 trillion).

  Greg LaRocca, Director of Market Research and Economic Policy at SIA, stated in an interview that chip sales are expected to grow by 11.2% by 2025. This is important for the economy because chips are the core of all electronic products and an important component of the technological food chain.

   These data were released at an important moment of national discussion, because President Donald Trump has promised to levy tariffs on semiconductor chips not only from China but also from Taiwan, China.   The tariffs in Mexico and Canada have been postponed for 30 days.

   Nvidia CEO Huang Renxun visited Trump at the White House last Friday, emphasizing the importance of the semiconductor industry and the United States' leadership position in the field of artificial intelligence.   The Consumer Technology Association estimates that tariffs could increase the prices of gaming consoles purchased by American consumers by 40%, smartphones by 26%, and laptops by 46%.

   SIA is also an active advocate for the Chip and Science Act, which has received bipartisan support and allocates $52 billion to rebuild the US chip manufacturing industry. Intel stated that it has received $2 billion in funding for its US chip factory. It remains to be seen whether the new government will continue to support the bill, as supporters are calling for more funding to be allocated for it.

   After all these factories are built, put into operation, and put into use, chip production in the United States may increase by about 14% by 2032. This will take time. This is an absolutely huge industry. A growth rate from 10% to 14% is actually a very good number. This shows how difficult growth is. Of course, the same is true in Europe, "Duncan Stewart, head of chip at Deloitte, told me in a report interview this week.

   In terms of chip quantity, the sales revenue in the fourth quarter was $170.9 billion, an increase of 17.1% compared to the fourth quarter of 2023 and a growth of 3.0% compared to the third quarter of 2024. The global sales in December 2024 were $57 billion, a decrease of 1.2% compared to the total in November 2024.

   Monthly sales are compiled by the World Semiconductor Trade Statistics Organization (WSTS) and represent a three-month moving average. By revenue, SIA represents 99% of the US semiconductor industry and nearly two-thirds of non US chip companies.

   Neuffer said, "In 2024, the global semiconductor market will reach a historic high in sales, with annual sales exceeding $600 billion for the first time. It is expected that the market will achieve double-digit growth by 2025. Semiconductors support almost all modern technologies, including medical equipment, communications, defense applications, artificial intelligence, advanced transportation, etc., and the long-term prospects of this industry are very strong

   From a regional perspective, the annual sales of the Americas (44.8%), China (18.3%), and Asia Pacific/all other regions (12.5%) have all increased, but Japan (-0.4%) and Europe (-8.1%) have decreased. The monthly sales in the Americas increased by 3.2% in December, but decreased in Asia Pacific/All Other regions (-1.4%), China (-3.8%), Japan (-4.7%), and Europe (-6.4%).

   With the growth of global semiconductor sales, it is expected that by 2032, the domestic chip manufacturing capacity in the United States will triple, which will put our country in a favorable position to strengthen its supply chain and help meet the growing global demand, "said Norfer. In order to maintain the leading position of the United States in the field of chip technology, leaders in Washington should promote policies that promote semiconductor production and innovation, strengthen high-tech labor, and restore America's trade leadership

   In 2024, multiple semiconductor product fields have shown outstanding performance. The sales of logic products will reach 212.6 billion US dollars in 2024, becoming the largest product category in terms of sales. Memory products ranked second in sales, with a growth rate of 78.9% in 2024, reaching a total of 165.1 billion US dollars. The sales of memory subset DRAM products increased by 82.6%, the largest percentage increase among all product categories in 2024.

   Neuffer stated that logic (including processors), memory, and analog components are typically on different trajectories because there are many different types of semiconductors serving all electronics industries. Logic and memory have always been driven by the demand for AI servers in data centers and AI PCs in offices and homes. But sometimes there may be good times for logic and bad times for memory, depending on capacity.

   LaRocca stated that SIA has not yet classified AI chips separately, but most AI technologies are embedded in computer systems that use logic chips. He stated that the category has grown by 81% in 2024.

  This is an astonishing growth rate that we have never seen before, "Norfer said. This is truly a comprehensive and rapid growth

  But he pointed out that when it comes to fluctuations in areas such as storage chips, the industry may be "extremely unstable".

  Neuve casually said that the prospect of a trade war is "worrying".

  Our supply chain heavily relies on global trade. The operation of these supply chains is crucial for us. On the other hand, about three-quarters of our customers are overseas. Therefore, global trade is an important factor in our success, "said Norfer.

   Novo said he doesn't want to assume anything will happen. He pointed out that details are important, such as what happens when chips are shipped to the United States and eventually enter electronic products purchased in the United States. This also depends on which countries will be subject to tariffs and retaliation.

  In terms of educating politicians, he stated that there is still some work to be done in helping everyone understand how the supply chain operates.

  We believe that measures to increase the cost of manufacturing in the United States are problematic at a time when our company has made significant commitments to manufacture more products in the United States, and this administration sees this as a priority for manufacturing more products in the United States, "said Norfer. We really believe this is an opportunity to develop a comprehensive strategy that includes many aspects, such as continuing to provide incentives to make the United States attractive to manufacturing, increasing some design incentives, and developing a policy to regain our trade leadership position around the world, as we as an industry heavily rely on global trade

  Novo stated that the Chip and Science Act is extremely important for the industry and crucial for the country.

   But going it alone is not a strategy. It is part of a bigger strategy. This bigger strategy includes immigration policies to ensure that the talent we cultivate here stays in the country, as well as a broader workforce strategy to train talent domestically, "he said.

   He said that funding applied and basic sciences is also crucial for maintaining America's competitiveness. Some politicians oppose providing funding to companies to build chip factories. But Neuve pointed out that other countries have already used subsidies to withdraw manufacturing from the United States, and now we are lagging behind.

  This is the reason why we have been in trouble for many years. Our federal government has not been involved. Other governments in the world that have chip industries have been circling around us and may be confused about our predicament, resulting in a sharp decline in our manufacturing industry over the past 30 years or so, "he said. The Chip Act has reversed this situation, and if incentives are reduced again, our manufacturing footprint will also decrease. That's the reality

   LaRocca stated that the difference in incentives means that the cost of building and operating a wafer fab in the United States is 25% to 50% higher than in other countries without any incentives. Neuffer stated that there are also reasons such as supply chain resilience and national security that keep chip manufacturing domestically. He pointed out that the incentives under the Chip and Science Act have generated nearly $500 billion in investment in the United States. By 2032, the chip manufacturing capacity in the United States may double. Neuffer stated that this growth rate is higher than anywhere else in the world.

  During the epidemic, chip sales were disrupted. Although the demand for personal computers has surged with people working from home, factories have shut down and supply chains have been unable to operate normally during the pandemic. SIA stated that the industry began to decline from the second half of 2022, resulting in a 8.2% decrease in global sales in 2023. Compared to 2023, memory chip growth will reach 70% in 2024.

   Overall, the economic cycle of the tracheal industry from oversupply to shortage is 18 months. Part of the reason is that building a brand new factory requires billions of dollars and a significant amount of time. With changes in demand, it is difficult to quickly increase production capacity, so prices will also change.