The semiconductor industry is the aggregate collection of companies engaged in the design and fabrication of semiconductors. It formed around 1960, once the fabrication of semiconductor devices became a viable business. The industry's annual semiconductor sales revenue has since grown to over $481 billion, as of 2018. The semiconductor industry is in turn the driving force behind the wider electronics industry, with annual power electronics sales of £135 billion ($218 billion) as of 2011, annual consumer electronics sales expected to reach $2.9 trillion by 2020, tech industry sales expected to reach $5 trillion in 2019, and e-commerce with over $29 trillion in 2017.
The most widely used semiconductor device is the MOSFET (metal-oxide-semiconductor field-effect transistor, or MOS transistor), which was invented by Mohamed M. Atalla and Dawon Kahng at Bell Labs in 1959. MOSFET scaling and miniaturization has been the primary factor behind the rapid exponential growth of semiconductor technology since the 1960s. The MOSFET, which accounts for 99.9% of all transistors, is the driving force behind the semiconductor industry and the most widely manufactured device in history, with an estimated total of 13 sextillion (1.3 × 1022) MOSFETs having been manufactured between 1960 and 2018.
Unique features of the industry include continuous growth but in a cyclical pattern with high volatility. While the current 20 year annual average growth of the semiconductor industry is on the order of 13%, this has been accompanied by equally above-average market volatility, which can lead to significant if not dramatic cyclical swings. This has required the need for high degrees of flexibility and innovation in order to constantly adjust to the rapid pace of change in the market as many products embedding semiconductor devices often have a very short life cycle.
At the same time, the rate of constant price-performance improvement in the semiconductor industry is staggering. As a consequence, changes in the semiconductor market not only occur extremely rapidly but also anticipate changes in industries evolving at a slower pace. The semiconductor industry is widely recognized as a key driver and technology enabler for the whole electronics value chain.