Saudi Arabia Semiconductor Market Overview
Market Size in 2024: USD 6.20 Billion
Market Size in 2033: USD 11.10 Billion
Market Growth Rate 2025-2033: 5.90%
According to IMARC Group's latest research publication, "Saudi Arabia Semiconductor Market Size, Share, Trends and Forecast by Components, Material Used, End User, and Region, 2025-2033", The Saudi Arabia semiconductor market size was valued at USD 6.20 Billion in 2024. Looking forward, IMARC Group estimates the market to reach USD 11.10 Billion by 2033, exhibiting a CAGR of 5.90% during 2025-2033.
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Growth Factors in the Saudi Arabia Semiconductor Market
Vision 2030 and Economic Diversification
With Saudi Arabia's Vision 2030 initiative aimed at ending oil dependency through a technology-focused, economic transition playing a significant role in regional semiconductor market development, government investment in building out a domestic semiconductor industry is continuing to escalate. Key programs such as the Saudi Semiconductors Program (SSP) and the establishment of Alat, a "Riyad" Company for Advanced Technologies Manufacturing, are currently being heavily invested in by the Saudi government. Alat's $100 billion investment fund is promoting local chip design and manufacturing and attracting global technology companies to develop in Saudi's semiconductor value chain. These projects are helping to create a robust ecosystem in the semiconductor space which will directly support the country's state and telecommunications, smart cities, and technology sector while enhancing market growth by augmenting local innovation levels and reducing reliance on imported technology and semiconductors.
Rising Demand for Electric Vehicles
The move toward sustainable transportation systems in general and electric vehicles (EVs) specifically is increasing the semiconductor market in the Kingdom of Saudi Arabia. The government's desire is to make the Kingdom an EV manufacturing hub and the government's recent investment in Lucid Motors is a prime example of its newest initiative that will require more automotive semiconductors for ancient functionalities like battery management, and enhanced EV functions such as integrated navigation. For instance, in 2023 the Saudi Public Investment Fund invested $2 billion in Lucid Motors for EV production which ultimately drove the need for specialized semiconductors. The connection to electrification aligns with environmental objectives and is driving the market while the automotive sector booms.
Growth in AI and IoT Applications
The growing number of companies utilizing artificial intelligence (AI) and Internet of Things (IoT) technologies is a crucial growth component for the semiconductor market, as such technologies require chip improvements to handle critical data processing and connectivity. To be specific, the roll out of 5G networks in Saudi Arabia, backed by companies such as STC, will require high-performance semiconductor technology to allow for faster data speeds, processing, and the integration of the Internet of Things in smart cities - NEOM game on! Also, the demand for AI solutions in the healthcare and telecommunications sectors will also accelerate market growth, as many local companies will be utilizing the efficient chip design process to support these emerging applications and revolutionize the technological landscape of the market.
Key Trends in the Saudi Arabia Semiconductor Market
Adoption of Advanced Chip Designs
Another pragmatic trend within the Saudi Arabian semiconductor market is towards advanced chip designs like System on Chip (SoC) solutions to service the needs of new technologies. SoC designs bring together multiple functions onto one chip, providing increased efficiency for applications in AI and IoT. For example, SAMI Advanced Electronics is working on SoC solutions for defense and telecommunications to satisfy national security and connectivity objectives. Local manufacturers are adapting to this trend based on demand for smaller high-performance chips, which will allow them to compete globally, while also enabling Saudi Arabia to meet its digital transformation needs.
Focus on Sustainable Semiconductor Solutions
Sustainability is influencing and changing the semiconductor market in Saudi Arabia, with a growing focus on green manufacturing processes and materials. Furthermore, the Saudi government has made a commitment to renewable energy projects, like solar energy projects in NEOM, which will further stimulate semiconductor demand for solar photovoltaic cells. For instance, Oxagon, the industrial hub of NEOM, is seeking to be 100% renewable by 2030, with its ambition to develop green semiconductor technologies, which may be beneficial for the wider green semiconductor industry. This is consistent with the global sustainable development agenda and Vision 2030. The transition to a market with sustainable manufacturing practices will compel manufacturers to adopt more sustainable practices, in turn reducing their carbon footprints and making Saudi Arabia a more attractive and viable market for environmental/green investors.
Strategic Global Partnerships
Cooperation with foreign Semiconductor companies in Saudi Arabia is a growing trend that leads to the transfer of technology and the ability to produce at home. For example, Saudi Arabia is working with the world’s largest chipmakers such as TSMC and Intel to build semiconductor fabrication plants. This is similar to the government's agreements with global tech companies in Alat to localize chip production in Saudi Arabia - thereby building an experience base local to Saudi Arabia while relying less on importing chips. Such cooperation also provides Saudi local companies with relationships with multinationals that will share advanced manufacturing experience and train and enhance the skills of the workforce - for example through their training of the 5,000 engineers through the SSP. This trend is beneficial to enhance the global comparative advantage for chip production in Saudi Arabia - fostering entry to such a global technology market, with industrial self-reliance in local production leading to innovation.
Saudi Arabia Semiconductor Industry Segmentation:
The report has segmented the market into the following categories:
Components Insights:
Memory Devices
Logic Devices
Analog IC
MPU
Discrete Power Devices
MCU
Sensors
Others
Material Used Insights:
Silicon Carbide
Gallium Manganese Arsenide
Copper Indium Gallium Selenide
Molybdenum Disulfide
Others
End User Insights:
Automotive
Industrial
Data Center
Telecommunication
Consumer Electronics
Aerospace and Defense
Healthcare
Others
Breakup by Region:
Northern and Central Region
Western Region
Eastern Region
Southern Region
Competitive Landscape:
The competitive landscape of the industry has also been examined along with the profiles of the key players.
Future Outlook
The semiconductor market in Saudi Arabia is identified as a strong growth opportunity because of Vision 2030, which emphasizes technological innovation and economic diversification. In addition, investments in high-tech industrial centers, such as Oxagon, and partnerships with multinational semiconductor manufacturers, such as Intel to ramp up local chip production, will reduce reliance on imports. The increasingly embedded (or integrated) technologies of AI, IOT, and 5G will also drive significant demand for advanced, nano-scale (or very small) semiconductors, particularly in connection with smart cities and healthcare. Saudi Arabia's sustainable model, which follows international environmental goals, will also create demand for semiconductors used in renewable energy technology. As Saudi Arabia encourages its own talent development and infrastructure, the semiconductor market in the Kingdom will continue to be a regional hub for semiconductor innovation and will sustain long-term technological and economic development.
Research Methodology:
The report employs a comprehensive research methodology, combining primary and secondary data sources to validate findings. It includes market assessments, surveys, expert opinions, and data triangulation techniques to ensure accuracy and reliability.
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