The global foundry market is projected to surpass $100 billion for the first time in history in 2021.

According to the 2021 McClean Report recently published by IC Insights, total foundry revenue in 2021 is projected to reach $107.2 billion, a 23% increase from the previous year. This marks an all-time high and the first time revenue has exceeded $100 billion.

These results are attributed to strong demand for ICs used in advanced processors for networking and data center computers, new 5G smartphones, robotics, autonomous vehicles and driver assistance automation, artificial intelligence, machine learning, and image recognition, as well as other high-growth market applications.

This record growth matches the record growth rate of 23% increase in 2017. However, it is worth noting that the high growth rate in 2017 was mainly due to Samsung Electronics reclassifying System LSI internal transfers as foundry sales rather than strong organic market growth.

Based on this growth and demand, it is expected to reach a market size of $151.2 billion by 2025, showing a strong annual growth rate of 11.6%.

The entire foundry market consists of pure-play foundries such as TSMC, GlobalFoundries, UMC, and SMIC, as well as companies that produce only ICs for other companies and integrated device manufacturer (IDM) foundries such as Samsung and Intel that provide foundry services in addition to their own manufacturing.

The pure-play foundry market is expected to grow 24% this year to $87.1 billion, surpassing the 23% growth seen in the pure-play foundry market in 2020.

The pure play foundry market is expected to grow to $125.1 billion in 2025 and account for 82.7% of total foundry revenue, up from 81.2% in 2021 with a 5-year (2020-2025) CAGR of 12.2%.

TSMC, UMC, and several specialty foundries are expected to show healthy revenue growth this year. They are also making massive investments in new capacity to support the service demand expected during the forecast period.

Samsung dominates the majority of the IDM foundry market, with external sales primarily driven by customers such as Qualcomm.

IC Insights predicted that the IDM foundry market would grow by 18% this year to reach $20.1 billion.

The IDM foundry market is expected to grow to $26.1 billion in 2025, reaching a 5-year CAGR of 9.0%.

Intel announced plans to make a bigger leap forward as an IDM foundry over the next few years. Intel launched the 'IDM 2.0' initiative in March 2021 to turn around its IC manufacturing business after falling behind TSMC and Samsung in sub-10nm process technology.

Intel's two-part plan aims to transform the company, which has manufactured chips by emphasizing internal wafer fab capacity for decades.

Instead, we plan to utilize third-party foundries more for the most advanced process technology while transitioning into a major provider of contract manufacturing (foundry) services.