Having reached record highs in the past couple of years, the MCU market fell in the first half of 2019 with worldwide sales of microcontrollers declining about 13% compared to the first half of 2018 while MCU unit shipments fell 14%, says IC Insights.
With the MCU market showing signs of stabilizing at the midpoint of 2019, microcontroller sales are expected to pull out of the double-digit percentage slump in the next six months and record a 5.8% decline to $16.5 billion compared to the all-time high of $17.6 billion in 2018.
Worldwide MCU unit shipments are expected to drop 4% in 2019 to 26.9 billion from 28.1 billion in 2018.
The microcontroller market is expected to stage a modest rebound in 2020 after the 2019 decline, growing 3.2% next year to about $17.1 billion, while MCU shipments are projected to increase over 7% and set a new record-high level of 28.9 billion units (surpassing the current annual peak of 28.1 billion reached in 2018).
IC Insights’ forecasts that microcontroller sales will by a CAGR of 3.9% in the 2018-2023 forecast period, reaching $21.3 billion in 2023.
MCU unit shipments are projected to grow by a CAGR of 6.3% in the five-year forecast period to 38.2 billion in 2023.
MCU unit shipments have been climbing strongly in recent years, helped by the spread of automation and embedded control in systems, more sensors, and the growth in the Internet of Things (IoT). However, increases in revenues have been held back by sharply lower ASPs, primarily because of intense competition in the 32-bit microcontroller category.
IC Insights believes significant ASP erosion in 32-bit MCUs has ended with the average selling price forecast to drop by a CAGR of -3.7% between 2018 and 2023 compared to a -16.1% CAGR nosedive in the 2013-2018 time period.
Automotive microcontrollers sales are forecast to drop 5% in 2019 to $6.4 billion after rising just 1.1% in 2018 when vehicle sales began to decline. However, automotive MCU sales are expected to see a return to growth of 1% in 2020 to reach nearly $6.5 billion, followed by gradual strengthening in growth during the 2021-2023 period to reach $8.1 billion.