Establishing the new Power Products Group (PWR) as one of the four main Product Group pillars within Renesas is exciting and energizing for many reasons, and beneficial both internally to the company and externally to customers.
While we are well known for our embedded portfolio, to achieve our long-term revenue goals, growth from the Power group is imperative to our diversification and future success. The formation of the power electronics business has been a long time in the making and draws heavily from decades of in-house R&D and organic growth as well as the acquisitions of companies with an impressive power technology heritage, including Intersil, IDT, and Dialog Semiconductor. Combining the R&D talent, IP, and products from these companies makes the Power Products Group both diverse in its background and rich in its opportunities to create scale.
Additionally, just last month, we completed the acquisition of Transphorm, an expert in gallium nitride (GaN) transistors that will help us expand our wide bandgap portfolio and tap into what is projected by 2030 to be a $13 billion opportunity. That builds on a formidable technology foundation that now includes custom silicon, application-specific power-management integrated circuits (PMICs) both for customer and Renesas SOC/MCU and other digital platforms, compute power for both client and infrastructure, battery-management systems, discrete power devices and wide bandgap, IPD, eFuse and other automotive applications as well as growing catalog portfolio of DC/DC controllers, drivers, switchers, and many other components.
To achieve Renesas' 2030 goal to generate $20 billion in revenue, the Power Products Group intends to more than double sales to $7 billion. We will accomplish this by more deeply integrating our engineering talent to create more positive synergies and scale, focus on a few, fast growing vertical and megatrends such as AI infrastructure and client, automotive EV, and energy efficiency, as well as building a comprehensive “power tree” that expands our catalog portfolio to ensure we leverage Renesas' footprint in all products.
AI Infrastructure Leads the Way
How will we achieve this ambitious goal?
Through a focus on three high-growth market segments: AI with infrastructure, cloud computing, and AI at the edge (client); electric and conventional automotive platforms; and industrial systems and energy efficiency.
We are penetrating each sector using a two-pronged approach. The first is a vertical alignment that features tailored customer solutions, dedicated engineering teams, a power electronics center of excellence, as well as a growing series of Winning Combinations that bundle the best in Renesas power, analog, embedded processing, and connectivity solutions. The second is by adopting a full bill-of-materials focus that leverages our embedded processing leadership to attach to best-in-class MCUs, MPUs, and SoCs.
Demand for AI-enhanced data centers, edge-compute, and client devices alone will see the volume of AI SoCs increase from 2.5 million units in 2023 to 15 million in 2030 – a 20-plus-percent CAGR. At the same time, the number of power sockets per AI SoC will grow by up to five times today's levels, while the power content in each SoC will increase to at least $75 and in many cases more than $200, according to current customer forecasts.
Renesas continues to lead in digital controllers for computing applications, with multiple IC generations at the forefront of innovation and performance. With the rise of AI and its increasing power demands, Renesas is prepared to continue investing in this segment and delivering on the digital multi-phase controller and smart power stages attached to it. Additionally, we see opportunities to expand our total solution by attaching more power discrete devices and differentiate our solutions through superior support, custom tools, software, and modeling.
With more than 30 customer designs already in progress, we also expect to provide Renesas power solutions to at least 60 percent of all AI-enabled PCs by 2026. And we see that trend continuing across many other GPUs and SoCs, creating a much bigger opportunity for us. When you put all of that together – higher power content, higher ASPs, and continuous growth – we expect an exponential acceleration in the AI compute power-attach rate, which will change the dynamics of the business.
Growth Driven by Scale, Diversity and Consistency
The Renesas Power Products Group's 2024 priority is to scale our business by leveraging our IP leadership, engineering talent, culture, and manufacturing capabilities. This will allow us to diversify our business and customer engagement and deliver more value-added products and solutions, while consistently driving predictable execution to deliver superior customer solutions without compromising quality, for which Renesas is historically known.
In addition to automotive xEVs and industrial manufacturing equipment, we're excited about the opportunity to take our discrete business into AI infrastructure, where we have a significant expansion roadmap thanks to our close relationship with – and access to – our customers.
In the end, it's not just about expanding our markets, it's about leveraging and building on our foundation of trust and quality, becoming the preferred power choice for customers, and delivering proven, efficient, greener power solutions while reducing time to market by combining more of our products together and making the lives of our customers easier.