Source: Market.Us
January 17, 2024 03:52 ET
Chiplets Market to Reach USD 107.0 Billion by 2033; Amid Rising
Demand for Advanced Semiconductor Solutions
One of the primary drivers of the chiplets market is the soaring demand for high-performance
computing across various industries, including AI, data centers, automotive, and consumer
electronics. The ability of chiplets to efficiently handle complex computations while being energyefficient makes them highly suitable for advanced computing tasks.
New York, Jan. 17, 2024 (GLOBE NEWSWIRE) -- "According to Market.us, The Global Chiplets Market
size is expected to be worth around USD 107.0 Billion by 2033 from USD 3.1 Billion in 2023, growing at
a CAGR of 42.5% during the forecast period from 2024 to 2033."
Chiplets are discrete semiconductor components or functional blocks that can be integrated into a
larger chip or system. The chiplets market encompasses the providers of these specialized
components and the companies that integrate them into their designs.
The chiplets market refers to the industry segment that focuses on the design, development, and
integration of chiplets into electronic systems. Chiplets are individual semiconductor components or
functional blocks that can be combined to create a larger system or integrated into an existing chip.
This market encompasses chiplet providers, system integrators, and companies involved in chipletbased design and manufacturing.
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Analyst viewpoint
From an analyst's perspective, the chiplets market is poised for significant growth, driven by
compelling factors and presenting numerous opportunities. The key driving force is the escalating
demand for high-performance, energy-efficient computing in sectors such as consumer electronics,
data centers, and automotive industries. Chiplets offer a strategic solution to the limitations of
traditional monolithic chip architectures, especially as these industries push towards greater
computational power and miniaturization. The modular nature of chiplets, which allows for the
integration of various semiconductor technologies, is critical in enhancing performance and energy
efficiency.
Opportunities within the chiplets market are abundant, especially in driving innovation for emerging
technologies like artificial intelligence, 5G, and the Internet of Things (IoT). The adaptability of chiplets
to specific applications paves the way for tailored solutions, fostering advancements in these areas.
Furthermore, the growing need for standardization and interoperability among different chiplets
components offers a unique opportunity for collaboration across the semiconductor industry. This
collaboration could spur the development of a robust ecosystem, accelerating innovation and
broadening the application scope of chiplets.
Key Takeaways
The Chiplets Market is anticipated to reach USD 107.0 billion by 2033, with a projected steady
Compound Annual Growth Rate (CAGR) of 42.5% over the next decade. In 2024, it is expected to
reach USD 4.4 billion.
In 2023, CPU Chiplets held the dominant market position, capturing over 41% of the market
share, driven by high-performance computing demands.
The Consumer Electronics segment dominated the market with over a 26% share in 2023, due to
advancements in smartphones, laptops, and wearables.
IT and Telecommunication Services held a dominant position in 2023, with more than a 24%
share, driven by high-performance computing needs in data centers.
In 2023, the Asia-Pacific (APAC) region emerged as a dominant force, capturing over 31% of the
market share. This was attributed to advanced semiconductor manufacturing capabilities and
rapid technological advancements in the region.
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Factors Affecting the Growth of the Chiplets Market
Technological Advancements: The increasing complexity of semiconductor manufacturing,
along with the limitations of traditional monolithic chip designs, is a significant driver. Chiplets
technology, which allows for the integration of various microarchitectures on a single chip,
addresses these complexities and limitations, thereby driving market growth.
Demand for High-Performance Computing: There is a growing demand for high-performance
computing across various sectors, including AI, data centers, automotive, and consumer
electronics. This demand fuels the need for efficient, powerful, and smaller chips, which chiplets
technology facilitates.
Cost Effectiveness: The rising cost of advanced semiconductor manufacturing makes the
chiplets approach more appealing. By allowing different components to be fabricated separately
and then integrated, chiplets reduce manufacturing costs and the economic barriers to
advanced chip development.
Supply Chain Flexibility: The modular nature of chiplets offers greater flexibility in the supply
chain. Companies can source different components from various suppliers, reducing dependency
on a single source and mitigating supply chain risks.
Standardization and Interoperability Challenges: The growth of the chiplets market is somewhat
tempered by the need for standardization and interoperability among components from
different manufacturers. Establishing industry-wide standards is crucial for the widespread
adoption of chiplets.
Research and Development (R&D) Investments: The amount of investment in R&D activities by
key players in the semiconductor industry significantly impacts the growth of the chiplets
market. Continuous innovation and development are essential for addressing technical
challenges and expanding the capabilities of chiplets.
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Report Segmentation of the Chiplets Market
Type Analysis
In 2023, the CPU Chiplets segment held a dominant position in the market, capturing more than a
41.0% share. This dominance is largely attributed to the widespread use of CPU chiplets in highperformance computing applications, where their modular design allows for more efficient processing
power. The flexibility of CPU chiplets in integrating with other types of chiplets, like GPU or memory
chiplets, also contributes to their popularity. They serve as the core processing unit in many electronic
devices, from personal computers to sophisticated data centers, driving the demand significantly.
The GPU Chiplets segment, on the other hand, has been gaining traction, especially in gaming, AI, and
machine learning applications where high-end graphics and parallel processing capabilities are
paramount. Memory Chiplets are also crucial, particularly in applications requiring large, fast memory
pools, such as big data analytics and cloud computing.
Application Outlook
In 2023, the Consumer Electronics segment held a dominant position in the chiplets market,
capturing more than a 26% share. This predominance is primarily due to the escalating demand for
compact, high-performance electronic devices among consumers. The inherent ability of chiplets to
enhance processing power while minimizing physical space aligns perfectly with the needs of
smartphones, tablets, smartwatches, and other consumer electronics, which continually seek to
balance power and size.
Following consumer electronics, the Data Centers segment also shows substantial growth, driven by
the increasing data processing needs of cloud computing and big data analytics. Chiplets offer
scalable and efficient solutions for these large-scale operations, making them ideal for data centers.
End-User Analysis
In 2023, the IT and Telecommunication Services segment held a dominant market position in the
chiplets industry, capturing more than a 24% share. This segment's leadership is primarily due to the
burgeoning demand for advanced telecommunications infrastructure and IT services, fueled by the
global expansion of internet connectivity and the proliferation of cloud computing. Chiplets, with their
ability to offer high performance and efficiency in data processing and transmission, are integral to
meeting these demands. They enable the development of more powerful and energy-efficient servers,
routers, and other telecommunications equipment, which are essential for handling the increasing
data traffic and complex processing requirements of modern IT and telecommunication networks.
The Automotive sector follows closely, driven by the rapid advancements in electric and autonomous
vehicles. These sophisticated automotive technologies require high-performance computing
capabilities, which chiplets provide efficiently.
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Scope of the Report
Report Attributes
Market Value (2023)
Forecast Revenue 2033
CAGR (2024 to 2033)
Asia-Pacific (APAC) Revenue Share
Base Year
Historic Period
Forecast Year
Details
US$ 3.1 Billion
US$ 107.0 Billion
42.5%
31.0%
2023
2018 to 2022
2024 to 2033
Key Market Segments
Type
CPU Chiplets
GPU Chiplets
Memory Chiplets
Networking Chiplets
Sensor Chiplets
Application
Consumer Electronics
Data Centers
Automotive
Industrial
Healthcare
Other Applications
End-User
Telecommunications
IT and Telecommunication Services
Automotive
Healthcare and Life Sciences
Consumer Electronics
Other End-Users
Driving Factors:
Modular Design and Scalability: Chiplets enable a modular approach to chip design, allowing
designers to combine various specialized chiplets to create complex systems. This modular
design provides scalability, as chiplets can be upgraded or replaced without redesigning the
entire chip, resulting in cost savings and faster time-to-market.
Performance and Functionality: Chiplets allow designers to leverage the most advanced process
technologies for each functional block, optimizing performance and functionality. By integrating
chiplets with different capabilities, designers can create highly efficient systems with improved
power consumption, processing speed, and specialized functionalities.
Cost and Yield Optimization: The use of chiplets enables better yield and cost optimization in
semiconductor manufacturing. Instead of manufacturing a large monolithic chip, chiplets can be
produced individually, increasing the yield as defects in one chiplet do not render the entire chip
unusable. This approach reduces manufacturing costs and improves overall chip yield.
Opportunities:
Customization and Flexibility: Chiplets offer opportunities for customization, allowing designers
to tailor their systems for specific applications or customer requirements. With a range of chiplets
available, designers can mix and match components to create highly specialized and
differentiated products, catering to niche markets and customer demands.
Collaboration and Ecosystem Development: The chiplets market provides opportunities for
collaboration among chiplet providers, system integrators, and designers. Creating a robust
ecosystem of chiplet providers and integrating their offerings into a unified platform encourages
innovation, expands market reach, and fosters the development of new applications and
solutions.
Emerging Technologies and Applications: The rapid advancements in areas such as artificial
intelligence, 5G, edge computing, and Internet of Things (IoT) present significant opportunities
for chiplets. These technologies require specialized chiplets to handle specific functions, creating
new markets and applications for chiplet integration.
Regional Analysis
In 2023, the Asia-Pacific (APAC) region held a dominant position in the chiplets market, capturing
more than a 31% share. This dominance is largely attributed to the region's robust semiconductor
manufacturing capabilities and the presence of key industry players in countries like China, South
Korea, and Taiwan. The APAC region's rapid technological advancement and its significant investment
in research and development further bolster its leading status. Additionally, the growing demand for
consumer electronics, telecommunications infrastructure, and automotive technologies in APAC
countries drives the region's chiplets market forward.
North America, particularly the United States, is another significant player in the chiplets market. The
region's focus on innovative technologies, combined with substantial investments in the
semiconductor industry, positions it as a key market for chiplets. North America's advanced IT
infrastructure and the presence of leading tech companies also contribute to its substantial market
share.
Key Regions and Countries Covered in this Report:
North America
The US
Canada
Europe
Germany
France
The UK
Spain
Italy
Russia
Netherland
Rest of Europe
APAC
China
Japan
South Korea
India
New Zealand
Singapore
Thailand
Vietnam
Rest of Asia Pacific
Latin America
Brazil
Mexico
Rest of Latin America
Middle East & Africa
South Africa
Saudi Arabia
UAE
Rest of MEA
Key Players Analysis
Top 10 Chiplets Market Key Players
Amazon.com, Inc.
Alibaba Group Holding Limited
JD.com, Inc.
Walmart Inc.
ULink AgriTech Pvt. Ltd.
IndiaMART InterMESH Ltd.
Rakuten Group, Inc.
Etsy, Inc.
Farmers Business Network, Inc.
Tractor Supply Company
Recent Developments
In August 2023, a collaboration between Google Cloud (US) and NVIDIA Corporation (US) was
unveiled, aimed at providing advanced AI infrastructure and software. This partnership facilitates
the deployment of large generative AI models and accelerates data science tasks through Google
Cloud's NVIDIA-powered solutions
Announced in June 2023, Intel Corporation (US) forged a partnership with Taiwan
Semiconductor Manufacturing Company Limited (Taiwan) to manufacture chips catering to
Intel's high-performance computing and graphics products. This collaboration is designed to
mitigate Intel's dependence on external foundries.
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