IC Insights, a well-known semiconductor consulting firm, recently updated the latest “Macklin Report”, which pointed out that by 2026, the average selling price of MCUs is expected to increase moderately. Tight supply has led to a 10% increase in the average selling price of MCUs (microcontroller units) in 2021 – the largest increase in 25 years.
According to IC Insights, MCU sales picked up with a strong economic recovery in 2021, when the MCU market climbed 23% to a record $19.6 billion after falling 2% in 2020 amid the coronavirus crisis.
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IC Insights forecasts that global MCU sales will grow 10% in 2022 to an all-time high of $21.5 billion (see chart below), with automotive MCU growth outpacing most other end markets this year.
Moreover, a strong rebound in MCU average selling price (ASP) in 2021, up 10% to $0.64, which was the average price before the pandemic in 2019. ASP growth in 2021 is the highest annual growth rate for MCU selling prices in more than 25 years due to tight MCU supply amid the economic rebound in 2021.
The MCU market has faced steep price declines for two decades, but the rate of ASP decline has slowed over the past five years. IC Insights now expects MCU ASPs to rise at a CAGR of 3.5% between 2021 and 2026.
Furthermore, total MCU shipments will grow to 12% in 2021, bringing global MCU shipments to an all-time high of 30.9 billion last year. Forecasts from IC Insights show that total MCU shipments will grow at a CAGR of 3.0% over the five-year period to reach 35.8 billion units by 2026.
Total MCU sales are expected to grow at a CAGR of 6.7% from 2021 to 2026 and reach $27.2 billion in the last year of the forecast. Sales of 32-bit MCUs are expected to grow at a compound annual growth rate of 9.4% over the next five years, reaching $20 billion by 2026.
Meanwhile, sales of 4/8-bit MCUs are not expected to grow over the next five years, remaining stuck at about $2.4 billion in 2026. 16-bit MCU revenue is expected to grow at a CAGR of 1.6% during 2021-2026, reaching $4.7 billion in 2026.
The downturn in the automotive industry and a weak global economy in 2019 led to a 9% drop in MCU shipments that year, the worst decline in shipments since the 2009 semiconductor downturn (down 11%).
However, MCU shipments rose by 8% in 2020 despite the epidemic. MCU demand in the 2020 pandemic has been driven primarily by sales of home entertainment systems and electronics purchased by quarantined consumers, including large-screen TVs, IoT-connected products, and more sensors packed into smartphones.
About 46% of MCU sales came from MCUs in “general purpose” embedded applications (including smartphones, computers and peripherals, industrial use, and consumer products), while a little over 40% came from automotive systems, and 14% came from the smart card market for banks, Credit and debit card purchases, bus fares, ID and other uses.
Besides, automotive MCU sales are expected to grow at a CAGR of 7.7% over the next five years, while general-purpose MCU revenue is expected to grow at 7.3%, and the smart card market is expected to grow at a 1.4% CAGR through 2026.
