Semiconductor revenue remains strong in 2025, with industry-wide contributions

The semiconductor industry is thriving and on track to exceed $800 billion in 2025, with growth now more balanced across segments. AI and memory lead, setting up a record-breaking fourth quarter and 2026 expansion.

The semiconductor market continues to experience strong growth as quarterly revenue climbed in 3Q25 to $216.3 billion, a remarkable 14.5% quarter-over-quarter (QoQ) increase. This marks the first time the industry has exceeded $200 billion in a single quarter. It follows from a strong 2Q25, which delivered 8% QoQ growth, and puts the market on track to surpass $800 billion in total revenue for 2025.

3Q25 outstrips typical Q3s
Demand for AI and memory remains, with AI products and memory outpacing overall market revenue growth. The rapid rise of AI had been masking a much more mediocre semiconductor market. However, other segments are contributing more than in the last few quarters, leading to strong outcomes in 3Q25.

The historical average for third‑quarter growth is just over 7%. Public guidance issued during the second-quarter earnings season placed the third-quarter semiconductor revenue forecast at around 5% QoQ growth, aligning with a typical seasonal pattern. However, actual calendar Q3 results were far stronger, coming in at more than 14% QoQ growth. Nearly all semiconductor categories outperformed expectations from the previous quarter.

Revenue growth throughout the industry – not just for NVIDIA and memory
2024 was a record year for the semiconductor market, with revenue surpassing $650 billion, and an annual growth of more than 20% compared with 2023. However, this surge was not felt evenly across the industry. 

If the high‑growth segments—driven primarily by NVIDIA and memory ICs—are excluded, the rest of the market expanded by just over 1%. Despite the record year, many companies did not benefit from the boom. Inventory adjustments and weak demand continued to act as limiting factors throughout the year.

While AI and memory continue to lead the semiconductor market, the growth picture is no longer as one‑sided. Total market revenue in 3Q25 rose by more than 14% QoQ, and even with NVIDIA and memory ICs removed, growth still exceeded 9%. Nearly all semiconductor categories saw revenue increases in 3Q25. Trends for 2025 are expected to mirror this performance. 

Total semiconductor revenue is on track to surpass $800 billion for the year, representing nearly 20% growth over 2024. Excluding NVIDIA and memory, the remaining market is still projected to grow by around 9% annually. Overall, the semiconductor market in 2025 is experiencing growth across multiple segments, rather than being driven by just a few high‑performing areas.

Top four semiconductor companies leading the market
The top four semiconductor companies are NVIDIA and the three major memory vendors—Samsung, SK Hynix, and Micron—highlighting just how strongly AI and memory continue to lead the market. 

As Omdia’s Senior Principal Analyst Lino Jeng notes: “Demand for conventional DRAM is surging alongside HBM as AI inference workloads scale, driving an exceptional short‑term price rally. We expect Q4 to set a new all‑time revenue record, with this extraordinary strength likely to continue into next year.” Together, these four companies now account for more than 40% of all semiconductor revenue.

-- Cliff Leimbach, Senior Research Analyst, Omdia.