The rapid spread of generative AI is rapidly changing the landscape of the global semiconductor market. The surge in AI demand is expected to lead to wafer production capacity reaching an all-time high in 2028.

SEMI, an industry association representing the global electronics industry supply chain, recently released its '300mm Fab Outlook Report'.

Accordingly, semiconductor front-end companies are expected to continue to make large-scale investments in production facilities in response to the increasing demand based on AI, and unprecedented expansion of production capacity is expected by 2028.

SEMI forecasts that global wafer production capacity will grow at an average annual rate of 7% from the end of 2024 to 2028, reaching 11.1 million wafers per minute (Wpm) per month in 2028.

In particular, advanced process wafers of 7nm or less are expected to increase by approximately 69% from 850,000 sheets in 2024 to 1.4 million sheets in 2028. This is an average annual growth rate of 14%, which is twice the overall industry average.

The report also highlighted the growth of sub-2nm technologies.

Monthly production is expected to start at less than 200,000 units in 2025 and exceed 500,000 units in 2028, which is a direct reflection of the increasing demand for chips optimized for generative AI along with the advancement of semiconductor technology.

“AI has become a key driving force that is reshaping the semiconductor industry,” said Ajit Manocha, CEO of SEMI. “The spread of AI applications is driving demand for advanced chips, and the resulting expansion of investment is accelerating the growth of the entire industry.”

Along with this, investment in advanced process equipment is also expanding rapidly. The global equipment investment is expected to exceed $26 billion in 2024 and $50 billion in 2028, with an average annual growth rate of a whopping 18%. In particular, the 2nm and below equipment sector is expected to increase by 120% from $19 billion to $43 billion, indicating the growth potential of the high-performance semiconductor market in the future.

The semiconductor industry is experiencing unprecedented expansion, accelerating production and equipment investment in response to the surge in AI demand. In the future, with the commercialization of ultra-fine processes such as 1.4 nanometers, the reorganization of the global semiconductor supply chain is expected to accelerate.