Global Semiconductor Equipment Spending to Reach USD 165.9 Billion in 2026, Strengthening Opportunities for India

SEMI forecast projects continued growth through 2028 as AI-driven investments expand semiconductor manufacturing, testing and packaging worldwide.

Global semiconductor manufacturing equipment sales are projected to reach a record USD 165.9 billion in 2026, representing a 23.2% increase over the previous year, according to SEMI's Mid-Year Total Semiconductor Equipment Forecast. The forecast also projects equipment spending to grow further to USD 229.5 billion by 2028, marking five consecutive years of expansion for the industry.

Global spending on semiconductor manufacturing equipment is expected to reach USD 165.9 billion in 2026, up 23.2% from the previous year, according to SEMI's Mid-Year Total Semiconductor Equipment Forecast. The report projects the market to continue expanding to USD 229.5 billion by 2028, driven by investments in Artificial Intelligence (AI), advanced logic, high-bandwidth memory (HBM), advanced packaging and next-generation semiconductor manufacturing technologies.

According to the forecast, growth is expected across wafer fabrication equipment, semiconductor test systems, and assembly and packaging equipment as manufacturers increase production capacity to support AI-powered computing, hyperscale data centres, automotive electronics and intelligent edge devices.

The Wafer Fab Equipment (WFE) segment, the largest category, is forecast to reach USD 143.9 billion in 2026, while semiconductor test equipment is expected to increase 31% to USD 15.3 billion.

Commenting on the outlook, Ajit Manocha, SEMI President and CEO, said:

“AI is accelerating demand for more powerful and efficient chips, driving increased investment across the semiconductor capital equipment market. The mid-year forecast points to a higher equipment spending trajectory as chipmakers invest in the leading-edge logic, advanced memory, test and packaging capabilities required for the AI era.”

The report states that the current global investment cycle coincides with India's expanding semiconductor manufacturing plans. India has approved 12 semiconductor manufacturing projects covering fabs, ATMP/OSAT facilities, compound semiconductors and display manufacturing, representing investments of more than USD 20 billion.

It also highlights initiatives including the SEMICON India Programme, PLI, ECMS, EMC, RDI, AI Mission, and continued policy support for semiconductor design and manufacturing as part of the country's efforts to develop a broader semiconductor and electronics ecosystem.

Speaking on the opportunities for India, Ashok Chandak, President, SEMI India, said:

"The strong global growth in semiconductor manufacturing equipment investment reflects the beginning of a new technology cycle powered by AI, advanced computing and intelligent electronics. For India, this momentum aligns perfectly with our national semiconductor mission. As India rapidly builds fabs, OSATs, display manufacturing and a robust ecosystem for equipment, materials and components, the country is becoming an increasingly attractive destination for global investments. This presents a significant opportunity not only for semiconductor manufacturing, but also for developing a strong domestic supply chain, fostering innovation, creating high-value jobs and integrating India more deeply into the global semiconductor value chain."

The report also highlights continued investments in advanced memory technologies, including HBM, DRAM and NAND, alongside leading-edge logic manufacturing.

Commenting on India's manufacturing roadmap, Ashok Chandak added:

"The report further underscores sustained investments in advanced memory technologies, including HBM, DRAM and NAND, and leading-edge logic manufacturing. As the global semiconductor industry races towards AI-driven, cutting-edge technologies, an equally important opportunity is emerging in mature and specialty semiconductor nodes, where demand remains strong across automotive, industrial, power electronics, communications and consumer applications. India's current manufacturing roadmap and design focus is well positioned to capitalise on this shift, enabling the country to become a competitive and trusted global manufacturing base while progressively moving up the technology value chain in future."

According to the report, increasing global demand for semiconductor manufacturing equipment is expected to create opportunities for equipment manufacturers, specialty material suppliers, automation companies, precision engineering firms, component manufacturers and technology service providers seeking to expand their operations in India.

The report states that as companies diversify semiconductor supply chains and governments promote resilient semiconductor ecosystems, India is positioned to strengthen its role in manufacturing, innovation and supply chain activities.

Regional Equipment Spending Outlook

The forecast indicates that China, Taiwan and Korea will remain the three largest markets for semiconductor equipment spending through 2028.

China is expected to retain the top position, although growth is projected to moderate in 2026 following elevated investment levels in recent years.
Taiwan is expected to benefit from investments in leading-edge manufacturing capacity for AI and high-performance computing.
Korea's equipment spending is forecast to be driven by advanced memory technologies, including HBM.
Other regions are expected to record higher equipment spending during 2027 and 2028, supported by regionalisation strategies, government incentives and targeted specialty capacity expansions.