In the second quarter, China maintained its position as the world's largest and fastest-growing market for semiconductor manufacturing equipment, driven by the country's efforts to achieve technological self-sufficiency amidst US sanctions. During this period, sales of chip-making equipment in China surged by 62% year-on-year, surpassing US12billion,fueling global semiconductor gear revenue growth to US12 billion, despite contractions in major markets like South Korea, Taiwan, and North America. Japan, ranking fifth in market size, also experienced a 6% revenue increase to US$1.6 billion, showcasing regional variations in industry performance.
SEMI's CEO, Ajit Manocha, noted the market's return to growth, attributing it to strategic investments supporting strong demand for advanced technologies and efforts to enhance chip-making ecosystems globally. The positive trend is expected to continue through 2024 and into 2025, with SEMI forecasting a 3.4% sales increase to reach a record high of US$109 billion this year, followed by a robust 17% expansion in 2025. Despite China's projected sales drop after years of significant investments, SEMI anticipates the country will remain the top market through 2025.
China's increasing demand for chip-making equipment aligns with Beijing's aim to reduce reliance on foreign supplies, prompting amid rising tensions between the US and China. Strains worsened as the US limited shipments from ASML to China since 2018, with the Netherlands revoking export licenses for high-end chip-lithography tools bound for China earlier this year. Facing pressure from the US, Dutch authorities consider further restrictions on ASML's ability to service installed equipment in China, impacting the company's operations in its largest market.
