Strategy Analytics: Global Smartphone Application Processor Market Reaches USD 25 Billion in 2020, Up 25% YoY

Strategy Analytics' Handset Component Technology (HCT) service recently released a research report titled "Smartphone Application Processor Market Share Tracking in Q4 2020: 5G and 5nm Application Processors Driving Growth", which pointed out that the global smartphone application processor (AP) market resumed revenue growth in 2020 for the first time since 2016.

The report pointed out that despite the COVID-19 epidemic, the global smartphone application processor market continued to show resilience and achieved a year-on-year growth of 25% to US$25 billion in 2020. In 2020, Qualcomm, Apple, HiSilicon, MediaTek and Samsung LSI ranked the top five in terms of revenue share in the highly dynamic global smartphone application processor market.

• Qualcomm maintained its leading position in the smartphone application processor market with 31% revenue share, followed by Apple (23%) and HiSilicon (18%).
• In 2020, 5G application processor shipments surged, accounting for more than a quarter of total smartphone application processor shipments.
• TSMC leads the smartphone application processor foundry market with more than two-thirds of the market share in 2020, followed by Samsung Foundry. Both foundries have strong demand for 7nm and 5nm application processors.
• 7nm and 5nm application processors were popular, accounting for nearly 40% of all smartphone application processor shipments in 2020.
• Artificial intelligence (AI) continues to be an important part of smartphone application processor supplier strategy, with shipments of smartphone application processors with on-device AI engines reaching 900 million in 2020.

Sravan Kundojjala, Associate Director at Strategy Analytics, commented: “Despite the global COVID-19 pandemic, trade wars and component shortages, the smartphone application processor market achieved its highest ever revenue in 2020. The growth was also driven by the increase in shipments of higher-priced 5G and 5nm application processors. Strategy Analytics believes that the ongoing semiconductor shortage indicates strong underlying demand. However, the increase in the number of mid- and low-end 5G application processors from Qualcomm, MediaTek, Samsung LSI and Unisoc will inevitably put pressure on the average selling price of smartphone application processors in 2021. Application processor suppliers need to adjust their cost structure in order to continue to benefit from the 5G wave.”

Stephen Entwistle, Vice President of the Strategic Technology Practice at Strategy Analytics, added: “The US-China trade war impacted HiSilicon in 2020. HiSilicon’s smartphone application processor shipments fell 20% in 2020. Strategy Analytics predicts that Apple, MediaTek, Qualcomm and Samsung LSI will eat into the market share left by HiSilicon in 2021. We believe Qualcomm is well positioned to capture the high-end market left by HiSilicon with its Snapdragon 888 and 870.”