Global Chip Industry To Allocate $400B For Equipment By 2027

Global semiconductor manufacturers are poised to allocate a historic $400 billion towards chip-making equipment from 2025 to 2027, according to a report by the industry association SEMI. This surge in investment is primarily fueled by rising demand for chips essential for artificial intelligence (AI) and memory storage, alongside the ongoing U.S.-China trade tensions prompting manufacturers to diversify their production capabilities.

Significant Spending Increase Anticipated

In 2025, spending on chip-making equipment is forecasted to increase by 24%, reaching $123 billion. Major equipment suppliers, including ASML from the Netherlands and U.S. firms like Applied Materials, KLA Corp, and Lam Research, along with Japan’s Tokyo Electron, are expected to benefit from this heightened demand.

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China is projected to maintain its status as the largest investor during this period, earmarking over $100 billion for chip manufacturing despite a slight decrease from 2024 levels. This investment is largely driven by China’s policies aimed at achieving self-sufficiency and reducing dependency on foreign suppliers amid global trade pressures.

Contributions from South Korea and Taiwan

South Korea, home to leading memory chip manufacturers Samsung and SK Hynix, is estimated to invest $81 billion during this three-year period. Meanwhile, Taiwan, which hosts TSMC—the world’s largest contract chipmaker—will allocate around $75 billion to enhance production capabilities, not only domestically but also in the U.S., Japan, and Europe.

Additional substantial investments are expected in various regions, with $63 billion in the Americas, $32 billion in Japan, and $27 billion in Europe. SEMI anticipates that these areas will more than double their spending on semiconductor equipment by 2027, driven by policy incentives designed to secure a steady supply of semiconductors.

(INCLUDES INPUTS FROM ONLINE SOURCES)

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