Sales of memory ICs are expected to show the strongest growth rate among major IC market categories during the next five years, according to IC Insights.

Revenues for memory products - including DRAMs and NAND flash ICs - will increase by a compound annual growth rate (CAGR) of 7.3% to US$109.9 billion in 2021 from US$77.3 billion in 2016, said IC Insights.

Meanwhile, the weakest increase is expected to occur in the logic category, which includes general-purpose logic, ASICs, field-programmable logic, display drivers and application-specific standard products, IC Insights indicated. Revenues for logic products are forecast to grow at a CAGR of just 2.9% during 2016-2021.

The strong memory CAGR is driven by surging low-power memory requirements for DRAM and NAND flash in portable wireless devices like smartphones, and by growing demand for solid-state drives (SSD) used in big-data storage applications and increasingly in notebook computers. Moreover, year-over-year DRAM bit volume growth is expected to increase throughout the forecast to support virtualization, graphics, and other complex, real-time workload applications.

Analog ICs, the second-fastest growing segment, are a necessity within both very advanced and low-budget systems. Power management analog devices are critical for helping extend battery life in portable and wireless systems and have demonstrated strong market growth in recent years. In 2017, the signal conversion market is forecast to be the fastest growing analog IC category, and the second-fastest growing IC product category overall, trailing only the market growth of 32-bit MCUs, IC Insights said.

Total microcomponent sales have cooled significantly. Fortunately, marginal gains in the handset MPU market and strong gains in the 32-bit MCU market have helped offset weakness of standard PC and tablet microprocessor sales, IC Insights identified.

The market for total ICs including memory, analog, microcomponents and logic chips is forecast to increase at a CAGR of 4.9% during 2016-2021, according to IC Insights.