Market Intelligence & Consulting Institute (MIC) is hosting the 37th annual MIC Forum Fall, themed AI Smart Chain: Now & Next, from September 10 to 12 in Taipei, Taiwan. Today, MIC released its semiconductor industry forecast, predicting continuous strong growth in the global semiconductor market from 2024 to 2025, reaching new heights not seen since 2018. The two major growth drivers will be the recovery of memory IC prices and the increasing demand for AI. According to MIC industry consultant Sagitta Pan, over 80% of the semiconductor market growth in 2024 will be driven by memory ICs, with AI contributing around 10%. Looking ahead to 2025, memory ICs will still account for about 50% of the growth, while AI will rise to approximately 40%. Additionally, the growth potential of logic chips for ICT applications is also noteworthy.

Taiwanese Semiconductor Industry Shipment Value, 2018-2025

Note: US$1=NT$31.6

Source: MIC, September 2024

MIC estimates that the shipment value of Taiwan's semiconductor industry will reach NT$4.76 trillion (US$150.7 billion) in 2024, representing a year-on-year growth of 21.3%, driven mainly by the recovery and growth of mainstream ICT products. Specific sectors are expected to experience growth as follows: foundries by 28%, IC design by 15%, memory IC/Integrated Device Manufacturing (IDM) by 18%, and IC packaging and testing by 6%. Looking ahead to 2025, advanced chips will continue to drive Taiwan's semiconductor industry, with overall output forecasted to grow by 15.9% compared to 2024, reaching NT$5.52 trillion (US$174.7 billion). Sub-industries such as foundries are expected to grow by 18%, IC design by 14%, memory/IDM by 15%, and IC packaging and testing (also known as OSAT—Outsourced Semiconductor Assembly and Testing) by 10%. Pan noted that the development of Cloud AI from 2023 to 2024 and the expansion of Edge AI, driven by AI PCs and AI smartphones from late 2024 to 2025, will present significant business opportunities for Taiwan’s supply chain.

Looking at the mid- to long-term development trends of the semiconductor industry, Pan further emphasized that as AI algorithms and generative AI (GenAI) continue to mature, AI intelligence will evolve into a service model, integrating into various fields such as IT, autonomous driving, green energy sustainability, and other industries. The increasing localization of AI services, tailored to the needs of different countries, will lead to the rise of regional AI service providers and localized value chains. As these AI applications scale, local chip solutions will emerge, driving higher autonomy and creating more opportunities for customized solutions. The combination of AI and semiconductors is poised to revolutionize the global tech ecosystem and introduce innovative changes to industry value chains. Moreover, as AI advances further, AI governance policies are expected to have a greater impact on the semiconductor market after 2026.

About Market Intelligence & Consulting Institute (MIC):

Established in 1987, Market Intelligence & Consulting Institute (MIC) is a division of III (Institute for Information Industry), a major government think tank, and one of the leading IT research institutes in Taiwan. MIC specializes in industry and market research. With over three decades of experience, MIC provides valuable insights and data-driven recommendations to assist businesses in making informed decisions.

To know more about this topic, please visit: Development of the Global Semiconductor Supply Chain Amid the U.S.-China Tech War (pre-order), Development of Taiwan's Third-Generation Semiconductor Industry and Key Players, Development of the Global Third-Generation Semiconductor Industry and Product Strategies of Leading Companies, Development of the Global Semiconductor Industry Under Geopolitical Influences, Recap and Outlook for the Taiwanese Semiconductor Industry, 1Q 2024

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