- Global semiconductor equipment spending continues strong growth, driven by rising capex and concentrated market leadership
- AI, advanced logic, and memory investments are accelerating a new multi-year capex cycle
- Structural shifts like advanced packaging increase equipment intensity beyond traditional semiconductor cycles
- Front-end equipment players at the forefront to ride the enduring demand for leading-edge chips
Related Insights
Global semiconductor equipment sales are expected to continue growing, driven by rising capex and structural trends. Gartner forecasts wafer fab equipment spending to reach USD138.5bn in 2026 (+11.8% y/y) and further expand by 9.2% in 2027, supported by demand across key processes such as lithography, deposition and materials removal. The market remains highly concentrated, with the leaders holding over 70% of global share.
Outlook remains positive, driven by a fresh capex cycle across chipmakers and hyperscalers. Leading semiconductor customers are accelerating investment in AI infrastructure, advanced logic, and high-bandwidth memory (HBM) chipsets, providing strong visibility for equipment demand. TSMC plans to raise 2026 capex to USD52–56bn, up roughly 27–37% from 2025, with most spending directed toward advanced nodes and packaging, while Samsung and Micron are also increasing investments focused on process upgrades and AI memory expansion. At the same time, hyperscalers such as Alphabet, Amazon, and Meta are driving a parallel infrastructure cycle, guiding for about 50%-100% y/y increase in capex for 2026. These combined spending plans reinforce demand for deposition, etch, lithography, packaging, and test tools.
Beyond capex expansion, structural industry shifts continue to support multi-year growth. Rising process complexity is increasing equipment and circuit intensity per wafer, while advanced packaging and heterogeneous integration are emerging as key growth areas driven by AI and high-performance computing. Additional support comes from electrification, edge AI, and industrial automation trends, alongside supply-chain diversification and government-backed semiconductor initiatives globally. Together, these factors suggest growth is increasingly driven by structural technology migration rather than purely cyclical wafer demand.
Recent results signal a strengthening AI-led recovery across both front-end and backend equipment segments. Front-end leaders such as ASML, Lam Research, Applied Materials, KLA, and Tokyo Electron reported solid results and constructive guidance, supported by strong AI infrastructure demand, improving demand for memory chips and increasing advanced-node investments. At the same time, backend players including Teradyne are seeing early signs of recovery, driven by sustained AI-demand. While backend recovery remains more gradual and execution-sensitive, the current upcycle is broadening beyond wafer-fab equipment toward a more integrated, packaging-driven growth phase.
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