Foundry set to grow 24.8%, but not all of the market is keeping pace

New data from TrendForce supports that view. While the market still appears strong at a global level, growth is becoming more concentrated in specific segments, leaving much of the industry moving at a noticeably slower pace.

According to TrendForce, global foundry revenue is projected to grow by 24.8% year-on-year in 2026, reaching approximately USD 218.8 billion. TSMC is expected to account for the largest share of that increase, with revenue growth of around 32% YoY. Capacity at 5/4 nm and below is already fully utilised, with order visibility extending into 2027.

The full Guest Article written by Claus Aasholm and his commentary can be found here: The deconstruction of a Semiconductor Cycle.

This momentum is largely driven by AI. Demand for advanced nodes continues to be fueled by GPUs developed by NVIDIA and AMD, but hyperscalers are also playing an increasingly important role. Google, Amazon Web Services and Meta are accelerating the development of their own chips, alongside AI-focused companies such as OpenAI and Groq. Many of these designs are expected to enter volume production in 2026, becoming a key driver for leading-edge process demand.

The resulting pressure is already visible in pricing. TSMC has raised prices for nodes at 5/4 nm and below for 2026, and with strong order visibility, further increases cannot be ruled out. Samsung Electronics has signaled similar intentions, informing customers of price increases already in the fourth quarter of 2025.

A more complex picture emerges, however, outside the leading edge. In the 8-inch segment, demand is primarily supported by AI-related power management components and domestic demand in China. At the same time, OEMs — particularly in the PC and notebook segments — began building inventory early in 2026 in response to rising memory prices and expectations of higher IC costs later in the year.

Additional support comes from segments such as DDI and CIS, which are performing slightly better than in previous cycles. Even so, utilization rates remain uneven. While some foundries are seeing improved loading, others continue to operate below capacity, limiting the scope for broad-based price increases across the segment.

A similar imbalance is visible in 12-inch wafers at mature nodes (28 nm and above). Despite ongoing capacity expansion in 2026, uncertainty around consumer electronics demand — further affected by high memory prices — continues to weigh on utilization. Process migrations and product upgrades may improve mix and average selling prices, but full capacity utilization remains out of reach for much of this part of the market.

In practical terms, this means that the projected 24.8% growth in foundry revenue does not reflect the reality of the entire semiconductor industry. Momentum is concentrated in a relatively narrow segment tied to advanced nodes and AI-driven demand, while mature nodes and end markets remain more sensitive to shifts in demand and pricing.

This aligns with the question raised earlier by Claus Aasholm — whether the industry can still be described as following a single cycle. TrendForce’s data suggests that what we are seeing instead is a set of parallel growth paths that only partially overlap.

What, then, does the semiconductor market really look like today — beyond aggregated indicators and headline growth rates? And how should companies interpret a situation where one part of the industry operates at full capacity with rising prices, while another continues to struggle with utilization?

This discussion will continue in May 7 at Evertiq Expo Kraków, where Claus Aasholm will take the stage for the first time in Poland. The same perspective will be further explored by Claus later in May 21 at Evertiq Expo Lund 2026.