The industrial electronics segment spans a broad range of applications, including areas such as manufacturing and process automation, test and measurement, medical electronics, building and home control, energy generation and distribution, and military and civil aerospace.
Semiconductors counted as part of the industrial electronics umbrella include discretes, optical, sensors and actuators, and microcontrollers, as well as integrated circuits in the analog, microcomponents, logic and memory sectors.
“While not garnering the same kind of attention as other more headline-grabbing markets such as consumer electronics, wireless or computers, the industrial electronics space actually outgrew those areas last year, thanks to an increasing move among industries toward energy-efficient processes and greater demand for semiconductors delivering those functions,” said Robbie Galoso, research manager for electronics at IHS.
In fact, industrial electronics was the second fastest-growing semiconductor market after automotive in 2011, up a much larger 9.3 percent compared to the paltry 1.4 percent for the overall semiconductor space. Growth in 2012 is projected to moderate to 7.7 percent in light of economic uncertainty in Europe, and slowing manufacturing in China.
“TI owed its boost in revenue last year to the firm’s acquisition of National Semiconductor at the end of the third quarter in 2011, which added $446 million to TI’s bottom line for industrial electronics,” said Jacobo Carrasco-Heres, analyst for industrial electronics at IHS. “Without the buyout, TI’s revenue growth would have been flat.”
Prior to the acquisition, National Semiconductor was the No. 2 supplier of light-emitting diode (LED) driver integrated circuits, behind TI; the acquisition simply strengthened TI’s dominance in the area.
TI was also the No. 1 supplier last year in manufacturing and process automation, medical electronics; second in energy generation and distribution; and third in the test and measurement as well as the building and home control areas. The company had bolstered offerings in general-purpose analog integrated circuits, such as amplifiers, voltage regulators, data converters and interface, especially after the National Semiconductor purchase.
TI headed a field of nine other players. Together the 10 companies enjoyed combined industrial electronics semiconductor revenue of $12.9 billion, roughly 42 percent of a very sizable market worth approximately $30.6 billion.
Occupying the No. 2 slot last year after TI was Infineon, with industrial electronics revenue of $1.8 billion, up 24.1 percent from $1.5 billion in 2010. The German maker’s market share of the industrial electronics space amounted to 6.0 percent, up from 5.3 percent in 2010. Infineon continued to be the top supplier in the energy segment, and was second in manufacturing automation. The increasing shift of the market in several countries to renewable sources of energy, such as solar and wind, augurs well for Infineon’s industrial electronics revenue in the long term.
Infineon’s stellar growth pushed former No. 2 STMicroelectronics down to third place in 2011. Revenue for STMicroelectronics reached $1.7 billion, up just 4.4 percent from $1.6 billion the year earlier, to give STM a 5.4 percent market share. STM is the top supplier for the building and home control market, but fell to third in manufacturing and automation as well as in medical electronics.