The global semiconductor industry is experiencing a nuanced phase of recovery and transformation in 2025, marked by a rebound in demand after a prolonged inventory correction, escalating geopolitical competition, and surging investments in artificial intelligence (AI) and advanced computing technologies.
After a challenging 2023 and early 2024 characterized by oversupply and weakened consumer electronics demand, the market is showing signs of stabilization. According to recent data from Gartner and SEMI, global semiconductor revenues are projected to grow by approximately 12% in 2025, driven primarily by renewed demand in data centers, automotive electronics, and industrial applications.
AI Fuels Demand for Advanced Chips
The most significant driver of growth continues to be the explosive expansion of AI. Data centers are increasingly deploying high-performance computing (HPC) chips, particularly GPUs and AI accelerators, to support large language models and generative AI applications. Companies like NVIDIA, AMD, and emerging players in the AI chip space are reporting strong order volumes, with lead times extending for cutting-edge logic chips.
This demand has intensified competition in the foundry sector, where TSMC remains the dominant player in advanced node manufacturing (below 5nm). Samsung and Intel Foundry are aggressively investing to close the technology gap, with Intel committing over $100 billion to expand its U.S. and European fabs under the CHIPS and Science Act and EU Chips Act, respectively.
Memory Market Rebounds Strongly
The memory segment, particularly DRAM and NAND flash, is witnessing a robust recovery. After severe price declines in 2023, major suppliers such as Samsung, SK Hynix, and Micron reduced output, leading to a supply crunch in early 2025. As a result, memory prices have surged by over 30% quarter-on-quarter, benefiting manufacturers’ margins. The revival is fueled by inventory rebuilding in smartphones, PCs, and servers, as well as increased storage requirements for AI training and inference.
Geopolitical Fragmentation and Supply Chain Resilience
Despite the positive momentum, the industry faces significant headwinds from geopolitical tensions. U.S. export controls on advanced semiconductor technology to China continue to reshape global supply chains. In response, China is accelerating its domestic semiconductor capabilities, with SMIC advancing to 7nm process nodes for certain applications and significant state-backed investments in equipment and materials.
However, challenges remain in areas such as extreme ultraviolet (EUV) lithography and advanced packaging, where foreign technology still dominates. The push for self-reliance has led to a surge in Chinese fabless design companies and domestic equipment suppliers, though full technological independence remains a long-term goal.
Outlook: Cautious Optimism with Structural Shifts
Analysts project that while the cyclical upswing will support growth through 2025, long-term industry dynamics are being reshaped by structural forces: the convergence of AI, 5G/6G, electric vehicles, and edge computing. Sustainability and supply chain transparency are also becoming critical considerations for major OEMs.
“While the semiconductor cycle is turning upward, the era of easy growth is over,” said Dr. Lisa Chen, Senior Analyst at TechInsights. “Companies must now navigate a more fragmented, capital-intensive, and geopolitically sensitive landscape. Innovation, collaboration, and resilience will define the winners.”
In conclusion, the semiconductor industry stands at a pivotal juncture—balancing short-term recovery with long-term strategic transformation. As the backbone of the digital economy, its evolution will continue to shape the future of technology across every sector.

Friday, May 9, 2025 — Europe
Recent reports highlight that European lawmakers and industry groups are advocating for a "Chips Act 2.0", aiming to further bolster the region's semiconductor development. This push comes amidst concerns that the original objectives set by the EU's formal chip strategy in 2022 may not be met, necessitating significant reforms and upgrades.
The EU's ambition to achieve 20% of global chip production by 2030 appears increasingly out of reach, according to the latest assessments. The EU Chips Act, enacted in 2022 and effective from 2023, ambitiously targeted raising the EU’s share of the global semiconductor market from 10% to 20% by the end of this decade, including the domestic production of advanced chips at 2 nanometers and below. To accomplish these goals, the act planned to mobilize €43 billion in public and private investments, with €33 billion coming from the EU budget and the remainder from member states and the private sector.
Despite these initiatives, which have already attracted major semiconductor manufacturing projects such as Intel’s €33 billion investment in two new wafer fabs and a joint venture between TSMC and Bosch focusing on mature 28nm technology, several challenges persist. These include funding shortfalls, technological gaps, heavy reliance on imported raw materials, and high energy costs. Consequently, some projects have been delayed or even canceled.
Adding to these concerns, the European Court of Auditors (ECA) has projected that, at the current pace, the EU might only reach 11.7% of the global semiconductor market by 2030. In response, discussions around the Chips Act 2.0 are underway, with proposals suggesting a need for €20 billion in grants across the entire semiconductor supply chain, alongside strategic adjustments to support innovation in high-performance computing, AI, and quantum technologies.
Industry experts argue for a renewed semiconductor strategy with clear, achievable, and time-bound goals, backed by appropriate funding measures and regulatory adjustments when necessary. There is also an emphasis on leveraging Europe’s strengths, like ASML’s leadership in EUV lithography and Zeiss’s advancements in optical systems, to enhance its position in the global semiconductor landscape.
Furthermore, the trend towards collaborative efforts within the EU is becoming more pronounced, with nine countries forming the "Semicon Coalition" to boost self-sufficiency in chip production and strengthen their global standing. This coalition focuses on advancing technology sovereignty, enhancing supply chain resilience, and fostering innovation competitiveness.
Despite the hurdles, through legislative enhancements, innovative approaches, and increased cooperation, Europe aims to build a resilient ecosystem that supports the sustainable growth of its semiconductor industry.
 It is important to note that the perspectives presented in this news article are for reference only and represent personal opinions.

According to the latest survey by TrendForce, the overall server output value is estimated to reach US$306 billion in 2024, among which AI Server has better growth momentum than general servers, with an output value of approximately US$205 billion. As AI Server demand continues to grow in 2025 and the average selling price (ASP) contributes more, the output value has the opportunity to increase to nearly US$298 billion, and the proportion of overall server output value will further increase to more than 70%.
Chinese and American CSPs and Server OEM customers have increased their momentum to purchase Hopper series models, which will drive the total AI Server shipments in 2024 to increase by 46% year-on-year. Looking ahead to 2025, TrendForce estimates that AI Server annual shipments will increase by nearly 28% year-on-year, and the proportion of overall Server shipments will further increase to more than 15%.

As for the performance of major AI chip suppliers, the new Blackwell platform is expected to become the mainstream of NVIDIA's high-end GPU in 2025. However, the GB Rack series has a more complex design verification, and the supply chain still needs time to prepare. In addition, there are fewer working days in the first quarter due to seasonal factors. It is estimated that shipments will increase significantly after the second quarter. In addition, it is estimated that NVIDIA will launch solutions such as B300 and GB300 in the third quarter of 2025, which is expected to further boost the shipment momentum of HGX and GB Rack equipped with Blackwell.
In addition to NVIDIA, it is also worth noting that large CSPs are more actively investing in self-developed ASICs. In 2024, Google will still be the main shipper, but AWS's shipment growth will be stronger, with an annual growth rate of more than 200%. It is expected that AWS shipments will grow by more than 70% in 2025, and it will focus more on the development of Trainium chips and invest in AI applications such as AWS public cloud infrastructure and e-commerce platforms.
Reposted from: International Electronic Commerce, automatically translated by Google