Double-digit growth expected for power management ICs

Power management ICs, what Gartner tracks as voltage regulators, is the largest segment of the standard analog IC market and promises the strongest growth, according to the research company.

By Suzanne Deffree, Managing editor, news -- EDN, June 21, 2010

Gartner Inc today added to the string of good news for the analog market, reporting that revenue from power management ICs totaled $7.4 billion in 2009 and will hit $12.1 billion in 2014.

Power management ICs, what Gartner tracks as voltage regulators, is the largest segment of the standard analog IC market (multimarket building blocks) and promises the strongest growth, the research company said. Nonisolated DC-DC converters will show the fastest revenue growth, while high-current linear regulators, increasingly displaced by switch-mode devices, will show the slowest growth, according to the report.

Revenue for voltage regulators will grow at a 10.3% CAGR (compound annual growth rate) from 2009 through 2014, according to Gartner estimates. Gartner said that other analog segments will exhibit high-single-digit growth.

"Following a period of rapid recovery in 2010, growth for all analog ICs will slow in 2011. New manufacturing capacity, from investments made in 2010, will come on line in 2012, further depressing revenue growth. Thus, much of the revenue growth projected for analog and power management ICs will occur in 2010," Gartner wrote this morning in its Monday DQ report.

The Gartner report comes on the heels of National Semiconductor announcing financial results for its most recent quarter that beat Street estimates. The analog maker earlier this month reported sales of $398.5 million, up 10% sequentially and up 42% year over year. Power management products made up nearly half of the sales and showed 11% sequential growth. Still, analysts cautioned that National could see increased competition in the analog market as Texas Instruments brings its 300-mm analog fab on line. TI also narrowed its Q2 estimates toward the high end this month, in part on strength from power analog products.

Gartner projected revenue growth for eight types of power management ICs: high-current linear regulators, low-voltage LDOs, portable switch-mode regulators, AC-DC (and isolated DC-DC) converters, nonisolated DC-DC converters, battery charge controllers, multiline controllers and sequencers, and voltage references.

The DC-DC converters, used as high-current point-of-load supplies on circuit cards in servers and communications switching stations, will show the highest revenue growth, climbing from  $868 million in 2009 to $1.994 billion in 2014 for an 18.1% CAGR, Gartner said. High-current linear regulators, used with heat sinks inside consumer appliances including desktop computers, will show the slowest revenue growth at a 5.6% CAGR, despite the high volumes associated with this part type, Gartner said.

Gartner noted that movements toward green IT will favor switch-mode regulators over linear part types. Despite their price sensitivity, switch-mode regulators are increasingly used in consumer applications, such as LCD TVs and digital set-top boxes.

Gartner also noted that the anticipated switchover of plug-in power adapters and battery chargers from linear regulators to switch-mode topologies will offer an enormous boost for AC-DC converters and projected a 14.9% CAGR for these devices.