Semiconductor market hits record quarter, driven by memory surge
Semiconductor revenue grew 27% QoQ in Q1 2026 to reach USD 319 billion – the highest quarterly growth Omdia has recorded since it began tracking the market in 2002. It marks the third consecutive quarter of double-digit growth, putting the market on track to surpass USD 700 billion in the first half of 2026.
Memory was the primary driver. DRAM and NAND revenue nearly doubled QoQ, accounting for more than 40% of total semiconductor revenue – well above the long-term average of around 20%.
NAND was a particularly strong contributor. Revenue rose 96% to just under USD 48 billion, with average selling prices up 95% sequentially, driven by sustained AI and data centre demand combined with ongoing supply constraints. High utilisation and limited supply recovery – due to technology transitions, yield learning and product mix challenges – are expected to keep NAND momentum strong through Q2, according to a press release from Omdia.
Outside of memory, growth followed a more historically typical pattern. Non-memory semiconductor revenue grew just over 2% QoQ – modest, but still better than the typical Q1 decline of around 4%. Microcontrollers, discretes and optical components saw slight to mid-single-digit sequential declines, while AI and data centre-related components outperformed and offset the usual seasonal weakness.
Omdia expects the semiconductor market to grow more than 20% QoQ in Q2, which would bring first-half revenue above USD 700 billion and keep the market on track to surpass USD 1 trillion for the full year.
"Four consecutive quarters of double-digit revenue growth for the market show the strength of the current demand for semiconductors," said Clifford Leimbach, Practice Leader at Omdia.
The forces behind these numbers will be dissected in detail at Evertiq Expo Berlin on June 18, where Nikolaos Florous of Memphis Electronic presents "The Global Memory Market Reset" – a fact-based look at how AI-driven demand, geopolitical realignment and unprecedented capital intensity are reshaping supply, pricing and investment behaviour across both legacy and advanced memory.