Saudi Arabia Semiconductor Market Size To Hit $11.10 Billion By 2033, At A CAGR Of 5.90%

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.

Growth Factors in the Saudi Arabia Semiconductor Market

• Vision 2030 and Government Investment

Saudi Arabia's Vision 2030 has become the backbone for its booming semiconductor industry. Massive investments-like the $100 billion Alat initiative and the SAR1 billion National Semiconductor Hub-are putting the country on the map for chip development and innovation. These projects support at least 50 chip design firms, encourage international partnerships, and stimulate homegrown R&D with over 1,600 square meters of dedicated labs. The government isn't just pouring in money; it's also actively nurturing engineering talent, as 5,000 engineers are targeted for training by the end of the decade. With strategic funds and incentives for both local startups and foreign tech giants, these policies are transforming Saudi Arabia into a regional electronics powerhouse and smart city pioneer. The end goal: a self-sustained semiconductor ecosystem that fuels economic diversification and technological autonomy.

• Surging Demand from Smart Tech and 5G

The mushrooming use of smart devices, high-speed 5G networks, and digital platforms is supercharging Saudi semiconductor demand. An impressive 92% of the population uses smartphones, and with 5G already covering 60% of urban areas across 75 cities, the digital connectivity in Saudi Arabia is among the best in the region. These advances power everything from data-hungry applications to NEOM's ambitious 1.5 million sensors for future smart city tech. Importantly, it's not just consumer gadgets driving the market; the Internet of Things (IoT) now connects over 45 million devices, and automotive tech is rapidly integrating cutting-edge chips for safety, entertainment, and EV operations. With this amount of digital saturation, the demand for advanced chips keeps growing, creating fertile ground for sustained industry expansion.

• Focus on Local Manufacturing and Talent Development

Reducing reliance on imports is a driving force as Saudi Arabia aggressively builds its local semiconductor ecosystem. The government is courting 50 semiconductor firms to set up shop by 2030 and has created a $3.2 billion industry fund to back this vision. Already, 16 companies are operating under the National Semiconductor Hub, and a premium residency program is attracting experienced professionals. There's a robust pipeline for workforce development that includes partnerships with Saudi and international institutions, ensuring thousands of local engineers are trained in chip design and advanced manufacturing. This deliberate strategy enables Saudi Arabia to control the value chain-from R&D and design to packaging and testing-turning the country into a serious contender in regional and global chip supply, while fueling job creation and knowledge transfer.

Key Trends in the Saudi Arabia Semiconductor Market

• Localized Chip Design and Specialized Applications

Saudi Arabia is quickly moving beyond basic chip assembly and into advanced, localized chip design focused on mission-critical needs like AI, IoT, defense, and high-speed communications. The creation of 10 new chip designs tailored for 5G, IoT, and smart city requirements is already showcasing homegrown innovation. Companies such as SAMI Advanced Electronics are developing devices for both defense and civilian applications, and international chipmakers are joining hands with Saudi labs to develop everything from AI accelerators to secure payment chips. This shift not only reduces exposure to global supply chain risks but also helps ensure vital national infrastructure is both secure and resilient, setting the stage for further breakthroughs in electronics and automation.

• AI and Machine Learning Integration in Manufacturing

The intersection of AI, machine learning, and semiconductor manufacturing is reshaping the Kingdom's technology landscape. Roughly 30% of Saudi demand for advanced chips now comes directly from AI applications powering smart manufacturing, logistics, and data-heavy platforms. For example, NEOM's data centers process as much as 10 petabytes of information per day using new AI chipset collaborations with leaders like NVIDIA. These AI-powered chips are being rolled out across sectors, making everything from telecoms to transport smarter and more automated. To accelerate this movement, Saudi Arabia has launched $1.07 billion of tech initiatives to foster AI-driven solutions with giants like Microsoft, pushing the market for high-performance logic devices to new heights.

• Green Energy and Electric Vehicle (EV) Growth

Sustainability is taking center stage in Saudi Arabia's semiconductor market, with strong demand coming from the burgeoning electric vehicle market and renewable energy expansion. The government's investments in local EV manufacturing-including a $2 billion partnership with Lucid Motors-are putting thousands of chips into every new green car. Meanwhile, solar and wind projects aiming for 10 GW of clean energy push the need for specialized power semiconductors dedicated to efficient energy management. These sectors serve as both testing grounds and launch pads for innovative chip solutions, strengthening Saudi Arabia's position in cleantech and sustainable mobility.

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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

Looking ahead, Saudi Arabia appears set to become one of the region's semiconductor pacesetters. The convergence of mega-projects like NEOM, aggressive government funding, and broad industry partnerships is rapidly closing the technology gap with global leaders. Demand for chips in everything from smart devices and digital infrastructure to advanced vehicles and renewable energy continues to rise, fueled in part by a booming digital economy. The ongoing training of thousands of engineers and the influx of experienced international talent will keep innovation flowing, reducing reliance on imports and increasing knowledge transfer. Saudi Arabia's bold bet on local manufacturing, high-tech exports, and homegrown R&D is likely to position the country not just as a customer but as an emerging innovator in the world semiconductor arena, ready to ride the next wave of global tech disruption.

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.

Note: If you require specific details, data, or insights that are not currently included in the scope of this report, we are happy to accommodate your request. As part of our customization service, we will gather and provide the additional information you need, tailored to your specific requirements. Please let us know your exact needs, and we will ensure the report is updated accordingly to meet your expectations.

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