Semiconductor manufacturing capacity will increase by 6% in 2024 and 7% in 2025 from its Q1 level of 33.7 million wpm (8” equivalent), says SEMI.
Capacity for 5nm nodes and below is expected to increase by 13% in 2024.
The moves by Intel, Samsung, and TSMC into 2nm GAA processors will increase leading-edge capacity by 17% in 2025.
“The proliferation of AI processing, from cloud computing to edge devices, is fueling the race to 
develop high-performance chips and driving a robust expansion of global semiconductor manufacturing capacity,” says SEMI CEO Ajit Manocha, “this creates a virtuous cycle: AI will drive the growth of semiconductor content across a diverse range of applications, which in turn encourages further investment.
Chinese chipmakers are expected to maintain double-digit capacity growth, registering a 14% increase to 10.1 million wpm in 2025 – nearly a third of the industry’s total – after a 15% rise to 8.85 million wpm in 2024.
Despite the potential risks of an overshoot, the region continues aggressive investment in its capacity expansion, in part to mitigate the impact of recent export controls. Foundries, including Huahong , Nexchip, Sien Integrate and SMIC, and DRAM maker CXMT are investing heavily.
Most of the other major regions are expected to see capacity growth of no more than 5% in 2025.
Taiwan is forecast to rank second in capacity in 2025 at 5.8 million wpm, a 4% growth rate, while South Korea is projected to take the third spot next year, expanding capacity by 7% to 5.4 million wpm after surpassing the 5 million wpm mark for the first time in 2024.
Fueled largely by Intel’s establishment of its foundry business and China’s capacity expansion, the foundry segment is projected to increase capacity 11% in 2024 and 10% in 2025, reaching 12.7 million wpm by 2026.
The rapid adoption of High Bandwidth Memory (HBM) to meet the rising demand for faster processors required by AI servers is powering unprecedented capacity growth in the memory sector. Exploding AI adoption has driven increasing demand for denser HBM stacks, with each stack now integrating 8 to 12 dice.
In response, leading DRAM makers are increasing investment in HBM/DRAM. DRAM capacity is expected to increase by 9% in 2024 and 2025. By contrast, the 3D NAND market recovery remains slow, with no growth in capacity forecast for 2024 and a 5% increase expected in 2025.
The rise of AI applications in edge devices is expected to increase DRAM content in mainstream smartphones from 8GB to 12GB, while laptops using AI assistants will need at least 16GB of DRAM. The expansion of AI to edge devices will also fuel demand for DRAM.
