Spending on semiconductor equipment in 2025 is expected to rise by 2 percent to $110 billion, marking six consecutive years of growth.
A SEMI report said spending is projected to increase by 18 percent in 2026, reaching $130 billion, driven by high-performance computing (HPC), memory sector demand, and AI integration.
The semiconductor industry’s capital expenditures signal a growing need for skilled workers, with about 50 new fabs expected to come online by 2026.
The Logic & Micro segment is a key driver of fab investments, fueled by advancements in 2-nanometer process and backside power delivery technology. Investment in this segment is expected to increase by 11 percent to $52 billion in 2025 and by 14 percent to $59 billion in 2026.
The Memory segment is set for steady growth, with spending projected to rise by 2 percent to $32 billion in 2025 and by 27 percent in 2026. DRAM investments are expected to decline by 6 percent to $21 billion in 2025 but rebound by 19 percent in 2026. NAND spending is forecast to surge by 54 percent to $10 billion in 2025 and by 47 percent to $15 billion in 2026.
China remains the top spender in semiconductor equipment, despite a projected decline from $50 billion in 2024 to $38 billion in 2025 and $36 billion in 2026. Korea is expected to be the second-highest spender, with investments growing by 29 percent to $21.5 billion in 2025 and by 26 percent to $27 billion in 2026.
Taiwan is projected to rank third in spending, with investments of $21 billion in 2025 and $24.5 billion in 2026. The Americas follow with expected spending of $14 billion in 2025 and $20 billion in 2026. Japan, Europe & the Middle East, and Southeast Asia are forecast to invest $14 billion, $9 billion, and $4 billion in 2025, and $11 billion, $7 billion, and $4 billion in 2026, respectively.
China is set to maintain its position as the top investor in new computer chipmaking equipment in 2025, despite experiencing a notable year-over-year decline in spending, according to a report released by industry group SEMI on Wednesday.
China, as the world’s largest consumer of semiconductors, has been aggressively expanding its chip manufacturing capacity for several years. However, in mid-2023 and throughout 2024, Chinese companies intensified their efforts with strong government support. This accelerated push is part of China’s strategy to reduce reliance on imported chips, particularly in response to trade restrictions and export controls imposed by the United States government.
ASML, one of the most top players in the chip equipment market, is forecasting sales between €32 billion and €38 billion in 2025, Reuters news report said. This range suggests that ASML will maintain a dominant market share of over 25 percent in the lithography segment, a critical technology in semiconductor manufacturing. Lithography is a key process in chip production, and ASML’s advanced equipment is indispensable to chipmakers around the world.
Applied Materials, KLA, and Lam Research remain among the top equipment suppliers. Tokyo Electron also holds a strong market position. However, Chinese equipment manufacturers, including Naura, AMEC, and SiCarrier, a Huawei-affiliated company, have been expanding their presence in the market.
Despite China’s continued leadership in chip equipment spending, its investment is projected to drop significantly to $38 billion in 2025, marking a 24 percent decrease from the $50 billion spent in 2024. Even with this decline, China’s spending remains significantly higher than that of Korea, where investments are expected to reach $21.5 billion. In Korea, leading memory chip manufacturers SK Hynix and Samsung Electronics are actively increasing their production capacity, particularly for memory chips that are crucial to AI and data storage applications.
Taiwan, home to the world’s largest contract chipmaker, TSMC, is projected to invest $21 billion in semiconductor equipment in 2025. TSMC plays a pivotal role in producing high-performance chips for companies like Nvidia and other AI-driven firms. The strong demand for AI chips has reinforced Taiwan’s position as a major hub for advanced semiconductor manufacturing.
Other regions are also expected to make substantial investments in chip fabrication tools. The Americas and Japan are each forecasted to spend $14 billion in 2025, reflecting the growing importance of semiconductor manufacturing outside of Asia. Meanwhile, Europe is projected to invest $9 billion in chipmaking equipment, as the region continues its efforts to strengthen its semiconductor industry and reduce reliance on external suppliers.
Baburajan Kizhakedath
