The global semiconductor manufacturing industry witnessed positive developments in Q2 2024, as evidenced by a rise in IC sales, stabilising capital expenditure, and increased wafer fab capacity. While some end markets saw a slower recovery in the first half of the year, the surge in demand for AI chips and high bandwidth memory (HBM) provided a significant boost to the industry’s expansion.
As Boris Metodiev, Director of Market Analysis at TechInsights, observes, “AI is certainly continuing to drive high value ICs to the market, while also supporting CapEx for capacity expansion of AI chips and especially HBM.” This AI-fueled demand led to a robust 27% year-on-year growth of IC sales in Q2 2024, with projections indicating a further surge of 29% in Q3.
Installed wafer fab capacity also increased, driven by capacity build-up for advanced nodes, particularly in the foundry and logic segments. China remains the fastest-growing region in this regard, despite moderate fab utilisation rates.
The positive trend is expected to continue in Q3 2024, with semiconductor capital expenditures projected to rebound, led by memory CapEx. Clark Tseng, Senior Director of Market Intelligence at SEMI, highlights how “strong demand for AI chips and high bandwidth memory is boosting results in various segments of the semiconductor manufacturing ecosystem.”
Overall, the industry is gearing up for a surge in 2025, as “the entire semiconductor supply chain is recovering this year,” according to Metodiev. The combination of recovering consumer demand and the push for new technologies like AI at the edge is expected to drive both unit volumes and revenues, supporting the broader semiconductor manufacturing sector.
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