Gartner has updated its semiconductor industry revenue outlook by 13% to $676 billion in 2022.

Increases in chip pricing and supply shortages are playing into the increase, but shortages and pricing should stabilize as the year progresses, said Alan Priestley, research VP at the firm.

“The semiconductor average selling price (ASP) hike from the chip shortage continues to be a key driver for growth in the global semiconductor market in 2022, but overall semiconductor component supply constraints are expected to gradually ease through 2022 and prices will stabilize with the improving inventory situation,” Priestly said in a statement about the outlook.

Gartner said the widely reported chip shortage will continue to impact automotive applications into 2023, including microcontrollers (MCUs), power management integrated circuits (PMICs), and voltage regulators.

In addition, “the memory market will remain the largest semiconductor device market through the forecast period and is projected to account for 31.4% of the overall semiconductor market in 2022,” said the report.

Finally, semiconductor revenue for smartphones is forecast to increase 15.2% this year due to an expected 45.3% growth in 5G smartphone unit production, according to Gartner. This growth will reach 808 million units and represents 55% of all smartphones produced.