More SV 150

For more than a half-century, Silicon Valley's economy and innovative culture has largely been defined by the microchip industry spawned by such legendary companies as Fairchild Semiconductor and Intel.

And while many firms that once sold chips or the equipment for making them have vanished over the years, semiconductors remain among the region's biggest businesses, according to this newspaper's latest annual tally of top local companies.

The chip sector accounted for 41 of the largest SV150 corporations, more than $100 billion in revenue, about $13.5 billion in profit and $280 billion in stock market value. In addition, the sector boasted more than 233,000 employees -- nearly 18 percent of the SV150's combined workforce.

Chip businesses continue to be based here in large part because they're surrounded by firms that make software for the tiny circuits and other firms that produce gadgets that run on them, said Linley Gwennap, a chip industry analyst.

"Silicon Valley is unique in having all three of those high-tech companies in this area, and that creates this huge amount of innovation," he said.

Santa Clara-based Intel remains the industry's Goliath, accounting for more than half of total sales racked up by the 41 companies. It's been hurt by the worldwide slowdown in personal computers, which heavily depend on Intel's microprocessors. But with smartphones, tablets and innumerable other devices needing chips, the semiconductor business remains lucrative for companies in the right niches.


Advertisement

Chip sales in 2013 were up nearly 7 percent over the previous year, according to research firm Gartner, and they are forecast to rise nearly 3 percent this year.

Contact Steve Johnson at 408-920-5043. Follow him at Twitter.com/steveatmercnews.