Europe falls behind in semiconductor market recovery
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The latest figures from the Semiconductor Industry Association (SIA) show the semiconductor market recovering in 2025, although Europe is falling behind the US and Asia in the AI boom.
Global semiconductor sales were $57.0bn in April, up 2.5% on March but more importantly up 22.7% than the April 2024 total of $46.4bn.
Does this indicate the upturn in the semiconductor market? The spring analysis from the World Semiconductor Trade Statistics (WSTS) shows a forecast of $700.8bn for the year, up 11.2%. This is a lot lower growth than the 19.7% in 2024, driven by the AI boom. That boom appears to be continuing, with 23% growth in 2025, up from 20% last year, but limited by chip making capacity at TSMC.
The forecast for 2026 is $760.7bn, up another 8.5% with the market slowing. This is pushing out the psychologically important $1 trillion market, which was expected in 2030 but now is likely to be 2032 on the current trajectory.
Europe remains weak through its focus on the industrial and automotive markets. Regionally, the Americas and Asia Pacific are set to lead the growth, with anticipated growth rates of 18.0% and 9.8%, respectively. In contrast, Europe and Japan are expected to show moderate growth.
Earlier this year Malcolm Penn of Future Horizons raised his forecast for global chip market growth in 2025 to 15 percent, plus or minus 4 percent.
This is despite Penn’s assessment that 2025 will be a “challenging year” and that the recovery base is “fragile.” He has been sceptical about the 2024 recovery arguing that it is based on average selling prices (ASPs) amidst flat unit sales. He argued that you couldn’t call something a proper recovery until unit sales are climbing. He has also been a sceptic of how long an AI boom can be sustained when it is not obviously generating funds through product sales.
Monthly sales are compiled by the World Semiconductor Trade Statistics (WSTS) organization and represent a three-month moving average.
“Global semiconductor sales in April ticked up on a month-to-month basis for the first time in 2025, and the global market continues to notch year-to-year growth driven by increasing sales into the Americas and Asia Pacific,” said John Neuffer, SIA president and CEO. “Meanwhile, a new WSTS industry forecast calls for solid global market growth in 2025 driven by demand for AI, cloud infrastructure, and advanced consumer electronics.”
Regionally, year-to-year sales in April were up in the Americas (44.4%), Asia Pacific/All Other (23.1%), China (14.4%), Japan (4.3%), and Europe (0.1%). Month-to-month sales in April increased in China (5.5%), Asia Pacific/All Other (5.3%), and Europe (0.5%), but decreased in Japan (-0.6%) and the Americas (-1.1%).
The SIA has endorsed the WSTS twice yearly Spring 2025 global semiconductor sales forecast for sustained industry growth. The expansion is primarily driven by continued strength in the Logic and Memory segments, both expected to post robust double-digit increases. Segments such as Sensors and Analog are anticipated to contribute positively, albeit with more moderate growth.
The decrease in Discrete Semiconductors, Optoelectronics and Micro ICs are projected to decline with lower single digits. These decreases are largely attributed to ongoing trade tensions and negative economic developments, which have disrupted supply chains and dampened demand in specific application areas.
Looking ahead, WSTS projects the global semiconductor market to grow by 8.5% in 2026, reaching $760.7 billion. Growth will be broad-based across regions and product categories. Memory is forecasted to lead growth again, with contributions from Logic and Analog as well.
www.wsts.org; www.semiconductors.org
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