TrendForce recently released a report revealing Broadcom outsold every other fabless semiconductor manufacturer during the second quarter of 2020. The research group determined that Nvidia experienced the most significant amount of annual growth in its sector due to the popularity of its data center products. The firm’s new rankings also highlighted the success of AMD (Advanced Micro Devices) and MediaTek’s latest offerings.
Here’s a look at some of the most interesting developments covered in TrendForce’s report on Q2 2020’s most prominent semiconductor designers.
Broadcom and Qualcomm Lead the Pack
Despite its sales chart triumph, Broadcom’s semiconductor business contracted by 6.8 percent from the second quarter of 2019. The firm’s income took a hit from mounting U.S.-China trade tensions. That said, the company’s long-term outlook is positive as it recently made a deal with Tesla to help design its self-driving system’s microelectronics.
Ironically, Qualcomm lost its position as the world’s best-selling integrated circuit (IC) company despite improving second-quarter results by its 6.7 percent year-over-year. TrendForce analyst C.Y. Yao explained the firm would have done better if not for the delayed 5G iPhone launch. Nevertheless, the brand’s recent success in the Indian and Taiwanese markets should improve its revenue in the current period.
Even though both firms encountered serious challenges, each made nearly $4 billion in semiconductor revenue last period. As such, the unparalleled appeal of Broadcom and Qualcomm’s chipset portfolios helped them endure international commerce headwinds and a global health crisis.
Nvidia on the Rise
Nvidia grew its Q2 IC revenue by nearly 50 percent from last year, but not because of its gaming segment.
That is not to say the brand’s graphics processing units (GPUs) have lost their luster among consumers. The firm’s gaming division improved its sales by 26 percent year-over-year. However, the company’s data center offerings outsold its core products by $10 million, due mainly to a coronavirus related demand surge.
Another big impact of the viral outbreak is that it increased digitization across all industries. Automated manufacturing, cashierless retail, and remote work technologies all existed before the onset of the coronavirus, but the pandemic popularized them. As Nvidia’s GPUs facilitated the mainstreaming of those concepts, those markets will drive the company’s future income.
The firm’s integration of Mellanox’s sales into its Q2 accounting also improved its revenue.
Previously, the brand was best known for its gaming hardware, but recent events have changed that perception. Like Apple, Nvidia has grown past its roots and is on the path to becoming a much greater company.
AMD and MediaTek Win with Innovation
AMD experienced the second-best rate of year-over-year revenue improvement of the top fabless IC companies in Q2. The brand expanded its semiconductor business by 26.2 percent from 2019 on the strength of its new Ryzen and EPYC offerings.
The firm’s sales spiked last period as millions of people bought new hardware to facilitate their work-from-home transitions. However, the innovative nature of its personal computer and server chips proved to be a real market advantage.
Since AMD utilized the Taiwanese Semiconductor Manufacturing Company (TSMC) ’s 7nm process to make its components, they offer better performance and energy consumption than rival offerings.
On a similar note, MediaTek increased its chip sales by 14.2 percent from 2019. TrendForce notes the company’s success is due in part to its recent cost optimization measures. However, the firm also increased its income by successfully launching a range of TSMC-made 5G products.
The company’s components have sold well because they enable original equipment manufacturers (OEMs) to produce appealing mid-range handsets. Since the deployment of fifth-generation mobile data networks is driving smartphone sales across the world, the firm unveiled the right components at the right time.
MediaTek’s state-of-the-art parts will help its partners thrive during a period of economic uncertainty. As a result, those OEMs will likely reward the brand with their loyalty for years to come.
While AMD and MeditaTek are very different brands, both are growing right now because they understand the importance of true innovation.
Ultimately, 2020 will go down in history as a year unlike any other for many reasons. But fabless semiconductor companies should take away a critical lesson from the current moment. Brands that prioritize quality, flexibility, and innovation will succeed even in the most unstable market conditions.