2020 was supposed to be a year of solid growth for the semiconductor industry, but those dreams were dashed as the world fell deeper into the clutches of the COVID-19 pandemic. As a result, market analysts and companies around the world are backpedaling hard to distance themselves from previous market and earnings forecasts. According to a recent report from McKinsey, there seems to be little reprieve as it projects demand in semicon to drop between 5 and 15 percent, compared to the year prior.
The report, which is based on two of the nine total projections made by McKinsey on global GDP recovery, predicts steep declines in the wireless communication (11-26 percent) and automotive sectors (10-27 percent), as well as moderate drops in demand for PC or server, consumer electronics and industrial segments. The only sector that’s expected to see an increase in demand is wired communication, with a projected increase of 8-11 percent. This increase is attributed to factors such as security upgrades for existing enterprise infrastructures, greater demand for cloud services and associated computing nodes and a more than 50 percent increase in fixed broadband usage – among others.