Semiconductor and Electronics: Insights into the Top 5 Trends Driving the Sector’s Growth in Q4 2024

The semiconductor and electronics industry has rapidly evolved in the last few years due to significant technological advancements and the rise in demand for more efficient electronic devices. The Internet of Things has become increasingly popular today, driven by the growing number of connected devices. Semiconductors play a key role in establishing connectivity among these devices and boosting their performance. In addition, the increase in demand for semiconductors with low power consumption and enhanced performance has augmented the development of innovative sensors, microcontrollers, and wireless communications.

Furthermore, the increasing usage of AI and ML technologies across industries has fueled the production of powerful processors and specialized hardware accelerators to handle intricate computations and data processing. In addition, the rising use of AI in areas including autonomous vehicles, robotics, and data centers, has increased the need for high-performance semiconductors to optimize AI workloads. Allied Market Research has recently presented a study on the latest developments and emerging trends that have restructured the landscape in the fourth quarter of 2024.

The potential of quantum computing components to boost the domain’s growth

Quantum computing is an emerging field that promises to revolutionize information processing by utilizing the principles of quantum mechanics, such as superposition and entanglement. Unlike classical computing, which relies on bits as the basic unit of information, representing either a 0 or a 1, quantum computing uses quantum bits or qubits, which can represent both 0 and 1 simultaneously due to superposition. This allows quantum computers to perform certain calculations much faster and more efficiently than classical computers. The increasing application of quantum sensors in space communication has created huge growth opportunities for the domain in Q4 2024.

Innovations in advanced packaging technologies opening new avenues across the sector

Advanced packaging technologies have played a key role in the development of smaller, faster, and more power-efficient electronic devices. Packaging techniques like Chip-on-Wafer-on-Substrate (CoWoS) and Fan-Out Wafer-Level Packaging (FOWLP) have become more prevalent in offering higher performance, smaller form factors, and better thermal management. These technologies enable semiconductor manufacturers to overcome the limitations of traditional packaging methods, providing better integration, higher performance, and improved heat dissipation. In the medical industry, the rise in the demand for nano-sized robotic surgery equipment and rapid advancements in wearable and personalized devices are the major factors that have driven the growth of the sector in Q4 2024. As per AMR’s latest report, the advanced packaging market was valued at $48.5 billion in 2023. The industry is expected to garner $119.4 billion by 2032, rising at a CAGR of 10.6% from 2024 to 2032.

Furthermore, the advent of technologies including MEMS devices, RFID, and other power devices has increased the production of thin wafers. They help reduce the thickness of packages, especially for smartphones, handheld devices, and compact electronic products. On the other hand, the emergence of fab-out wafer-level packaging has created significant opportunities in the industry. This type of packaging offers a smaller package footprint along with improved thermal and electrical performances, thereby increasing their adoption of the advanced packaging solutions.

The high adoption of 3D IC technology accelerates the prominent growth of the landscape

Three-dimensional integrated circuits (3D IC) are an emerging trend in semiconductor packaging that involves stacking multiple IC layers vertically instead of traditional lateral arrangement, to achieve higher functionality, improved performance, and reduced power consumption in a smaller packaging footprint. 3D ICs allow for faster data transfer, higher bandwidth, and better thermal management, by using techniques like Through-Silicon Vias (TSVs) and micro bumps to interconnect the stacked layers. This makes them ideal for applications such as AI, high-performance computing, mobile devices, and data centers. 3D IC is expected to play a key role in advancing next-generation electronics, meeting the growing demand for miniaturized and high-performance circuits.

The growth in Industry 5.0 creates ample opportunities in the SEMI domain

Industry 5.0 is an evolving concept that builds on the foundation of Industry 4.0, emphasizing the collaboration between humans and advanced technologies, such as AI, robotics, and IoT. The purpose behind the development of this advanced approach is to create more personalized, sustainable, and efficient manufacturing environments. Unlike the fully automated, machine-driven approach of Industry 4.0, Industry 5.0 focuses on human-centric innovation, where workers and intelligent systems work together to enhance creativity, decision-making, and production flexibility. Industry 5.0 aims to improve customization, reduce waste, and create more adaptive, resilient industries by integrating advanced automation with human expertise. This has boosted the manufacturing of highly efficient, environmentally sustainable, and socially responsible manufacturing systems.

In addition, the increasing adoption of collaborative robots has played an important role in bringing about the Industry 5.0 revolution. These robots are designed to work alongside human workers, facilitating seamless cooperation and boosting overall productivity. They are comprised of cutting-edge sensors and enhanced features, offering a safer and more interactive workplace environment. On the other hand, the growing adoption of manufacturing 5.0 to enhance efficiency and strengthen collaboration between humans and machines is expected to create extensive opportunities for the sector in the coming era. As per a recent report published by Allied Market Research, the Industry 5.0 market is projected to generate a revenue of $637.4 billion by 2032, growing at a CAGR of 17.3% from 2023 to 2032.

Advancements in power electronics revolutionizing the sector remarkably

In the last few years, the development of wide-bandgap semiconductors like silicon carbide (SiC) and gallium nitride (GaN) has brought notable advancements in the power electronics industry. They have revolutionized the efficiency and performance of electric motors. These materials have superior electrical properties compared to traditional silicon, including higher thermal conductivity, greater voltage tolerance, and faster switching speeds, allowing for more efficient power conversion and energy management in motors. SiC is particularly beneficial for high-voltage applications, enabling electric motors to operate at higher voltages with reduced losses and improved thermal management. This translates into smaller, lighter, and more efficient motor designs, which is essential for applications in electric vehicles, renewable energy systems, and industrial automation.

In a nutshell

The semiconductor and electronics industry has observed significant growth in the fourth quarter of 2024, owing to the growing development of advanced chips across various fields including healthcare, automotive, and diagnostics. The growing transition toward the development of low-energy consuming devices has created broader opportunities in the domain. Moreover, the rising adoption of 5G networks is expected to propel the development of advanced semiconductor solutions in the upcoming years.

To gain more insights into the investment opportunities in the SEMI domain, talk to our industry analysts today!