ASIC CHIP MARKET SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2024-2031)

ASIC Chip Market Size and Trends

The ASIC chip market is estimated to be valued at USD 20.29 billion in 2024 and is expected to reach USD 32.84 billion by 2031, growing at a compound annual growth rate (CAGR) of 7.10% from 2024 to 2031.

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The ASIC chip market is expected to witness significant growth during the forecast period. Implementation of advanced technologies such as artificial intelligence, machine learning, and 5G is increasing the demand for Application-Specific Integrated Circuit (ASIC) chips from various end-use industries including automotive, consumer electronics, telecommunications, and data centers. Increasing investments by leading market players to develop more efficient and cost-effective ASIC chips is another factor anticipated to drive the demand for application-specific integrated circuits. Extensive research and development activities taking place particularly in the automation and transportation sectors will further aid in revenue generation in the ASIC chip market in the coming years.

Growing Demand for Digitalization

The growing demand for digitalization across various industry verticals is expected to be a key driver for the ASIC chip market in the coming years. With digital transformation becoming integral to business operations, there is an increasing need for specialized and efficient computing capabilities that can power next-generation technologies. ASIC chips are well-suited to meet this need as they can be customized for very specific applications, delivering optimized performance.

For instance, in February 2021, Intel partnered with the U.S. Defense Advanced Research Projects Agency (DARPA) for a three-year collaboration aimed at advancing domestically manufactured Application Specific Integrated Circuit (ASIC) platforms. This partnership, named Structured Array Hardware for Automatically Realized Applications (SAHARA), focuses on designing custom chips with cutting-edge security features. A secure and reliable source of advanced semiconductors is crucial for the U.S. The collaboration involves combining Intel's top-notch eASIC structured ASIC technology with modern data interface chiplets and enhanced security measures, all manufactured entirely within the U.S. using Intel's advanced 10nm semiconductor process. This initiative aims to support developers in the defense and commercial electronics sectors to swiftly create and deploy custom chips for their specific needs.

The design and engineering of modern systems has become increasingly complex over the years as new technologies emerge and more advanced capabilities are expected from electronic devices. This rising complexity in workloads and requirements is driving the need for specialized processor chips that can efficiently handle the specific tasks involved. Application-specific integrated circuits (ASICs) are now being adopted across industries as they can be custom-designed and optimized for the exact functions needed.

As systems continue to incorporate more sophisticated algorithms and integrated functionalities, the underlying chip architectures need to keep pace. ASICs provide a means to hardwire innovative accelerators and customized instruction sets that general purpose CPUs struggle to match. This ability to optimize at the chip level down to the transistor is driving ASIC adoption across industries handling data-intensive and low-latency workloads. Looking ahead, emerging technologies such as 6G, augmented reality/virtual reality, autonomous robotics, and quantum computing will place even higher demands that only ASICs can efficiently address. According to 2020 data from the United Nations Conference on Trade and Development, the worldwide semiconductor revenue grew by 6% year-over-year despite the challenges of the global pandemic, a testament to the continued expansion of digital technologies.