SEMI: $400 Billion in Global Wafer Equipment Spending by 2027

The Semiconductor Equipment and Materials International (SEMI) has estimated that semiconductor manufacturers will invest a record $400 billion in 12-inch wafer fabrication equipment from 2025 to 2027. This surge in spending is expected to be led by China, followed by South Korea and Taiwan.

In addition to the regional development of semiconductor fabs, the demand for AI chips in data centers and edge devices is driving continuous growth in expenditures.

A recent report from SEMI forecasts a 4% increase in global spending on 12-inch wafer fab equipment this year, reaching $99.3 billion. This figure is projected to jump by 24% in 2025 to $123.2 billion, surpassing the $100 billion mark for the first time. Spending is expected to grow by 11% in 2026 to $136.2 billion, and by another 3% in 2027, totaling $140.8 billion. Cumulatively, expenditures from 2025 to 2027 are set to exceed $400 billion.

China is anticipated to invest over $100 billion over the next three years, maintaining its position as the largest spender on 12-inch wafer fab equipment globally. However, the report indicates that spending in China will gradually decline from a record $45 billion this year to $31 billion by 2027.

South Korea is projected to invest a total of $81 billion over the next three years to solidify its leadership in memory sectors such as Dynamic Random Access Memory (DRAM), High Bandwidth Memory (HBM), and 3D NAND Flash.

Taiwan is expected to allocate $75 billion for 12-inch wafer fab equipment over the same period, placing it third in global spending.

Industry analysts believe that Taiwan Semiconductor Manufacturing Company (TSMC) will be a major driver of this increased expenditure. TSMC has adjusted its capital expenditure forecast for the year, now estimating a range of $30 to $32 billion, primarily to support customer demand. This adjustment reflects market expectations without raising the upper limit of their forecast.

Recent reports suggest that TSMC's capital expenditure in 2025 may see annual growth due to unexpected demand for advanced processes and the anticipated production capacity for 2-nanometer technology. There are indications that TSMC is ramping up research and development for 2-nanometer processes, with demand exceeding expectations. The company's 2025 capital expenditure could reach between $32 billion and $36 billion, marking a significant year-on-year increase of 12.5% to 14.3%. Companies like ASML and Applied Materials are poised to benefit from this trend, along with related partners in Taiwan.