Revenue is expected to reach a "landmark" US$300.3 billion in 2010, up 31.5 percent from 2009, according to preliminary results released by Gartner. The semiconductor market rebounded after the worldwide recession hurt chip revenue in 2009, when year-over-year revenue declined by 10 percent.

As the economy stabilized this year, semiconductors manufacturers quickly added capacity to meet the growing demand of parts from system makers. But semiconductor demand started weakening again starting in the third quarter this year, Gartner said.

Despite the late-year slowdown, this year will go down as a "banner year" for the semiconductor industry, said Stephan Ohr, semiconductor research director at Gartner, in the statement. Yearly semiconductor revenue worldwide has grown by more 30 percent only in 1988, 1995 and 2000, Ohr said.

The top semiconductor company was Intel, which received a boost from a surge in PC sales during the first two quarters of the year. Intel's semiconductor revenue was $41.34 billion, growing 24.6 percent, with a 13.8 percent market share. Intel held a 14.2 percent market share the previous year.

Overall market revenue this year was hurt by poor sales of netbooks, Gartner said. Most of the netbooks ship today with Atom chips from Intel.