Global semiconductor factory capacity is expected to increase by 6% in 2024 and 7% in 2025, SEMI reports

Global semiconductor factory capacity is expected to increase by 6% in 2024 and 7% in 2025, SEMI reports

MILPITAS, California., June 18, 2024 /PRNewswire/ — To keep pace with relentless growth in chip demand, the global semiconductor industry is expected to increase capacity by 6% in 2024 and post a 7% gain in 2025, reaching record capacity of 33.7 million wafers per month will be achieved. (wpm: 8-inch equivalent), SEMI announced today in its latest quarterly World Fab Forecast report.

Global semiconductor factory capacity is expected to increase by 6% in 2024 and 7% in 2025, SEMI reports

Industry-leading capacity for 5nm nodes and below is expected to grow 13% by 2024, driven primarily by generative artificial intelligence (AI) for data center training, inference, and advanced devices. To increase the efficiency of processing power, chipmakers such as Intel, Samsung and TSMC are poised to begin production of 2nm Gate-All-Around (GAA) chips this year, driving total industry-leading capacity growth by 17 by 2025 % will increase.

“The proliferation of AI processing, from cloud computing to edge devices, is fueling the race to develop high-performance chips and robustly expanding global semiconductor manufacturing capacity,” said Ajit Manocha, SEMI President and CEO. “This creates a virtuous cycle: AI will drive the growth of semiconductor content in a wide range of applications, which in turn encourages further investment.”

Capacity expansion per region

Chinese chipmakers are expected to maintain double-digit capacity growth, rising 14% to 10.1 million wpm in 2025 – almost a third of the industry’s total – after rising 15% to 8.85 million wpm by 2024. Despite the potential risks of an exceedance, the region continues aggressive investments in capacity expansion, in part to mitigate the impact of recent export controls. Major foundry suppliers, including Huahong Group, Nexchip, Sien Integrated and SMIC and DRAM maker CXMT, are investing heavily to increase semiconductor production capacity in the region.

Most other major chip manufacturing regions are expected to see capacity growth of no more than 5% by 2025. Taiwan is expected to rank second in capacity in 2025 with 5.8 million wpm, a growth rate of 4%, while South Korea is expected to take third place next year, expanding capacity by 7% to 5.4 million wpm after exceeding the 5 million wpm mark for the first time in 2024. JapanAmerica, Europe & Middle East, and South East Asia Semiconductor manufacturing capacity is expected to grow by 4.7 million wpm (3% annualized), 3.2 million wpm (5% annualized), 2.7 million wpm (4% annualized) and 1.8 million wpm (4% annualized).

Capacity expansion per segment

Largely fueled by Intel’s establishment of its foundry business Chinas capacity expansion, the foundry segment is expected to increase capacity by 11% in 2024 and 10% in 2025, to reach 12.7 million wpm in 2026.

The rapid adoption of high-bandwidth memory (HBM) to meet the rising demand for faster processors that AI servers require is driving unprecedented capacity growth in the memory sector. The explosive adoption of AI has led to an increasing demand for more compact HBM stacks, with each stack now integrating 8 to 12 dice. In response, leading DRAM manufacturers are increasing their investments in HBM/DRAM. DRAM capacity is expected to increase by 9% in both 2024 and 2025. In contrast, the recovery of the 3D NAND market remains slow: no capacity growth is expected until 2024 and a 5% increase is expected in 2025.

With the rise of AI applications in edge devices, DRAM content on mainstream smartphones is expected to increase from 8 GB to 12 GB, while laptops using AI assistants will require at least 16 GB of DRAM. The expansion of AI to edge devices will also drive demand for DRAM.

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To learn more about SEMI reports on other semiconductor sectors, visit SEMI Market Data or contact the SEMI Market Intelligence Team (MIT) bee (email protected).

About SEMI
HALF® is the global industry association connecting more than 3,000 member companies and 1.5 million professionals worldwide in the semiconductor and electronics design and manufacturing supply chain. We accelerate member collaboration on solutions to the industry’s key challenges through advocacy, workforce development, sustainability, supply chain management and other programs. Our SEMICON® exhibits and events, technology communities, standards and market information help drive our members’ business growth and innovations in design, devices, equipment, materials, services and software, enabling smarter, faster and more secure electronics. Visit www.semi.orgcontact a regional office and connect to SEMI at LinkedIn And X learn more.

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