Global Semiconductor Sales Up for 8 Consecutive Months; AI Chips Main Driver
According to the latest data from the Semiconductor Equipment and Materials International (SEMI), global semiconductor sales reached $329 billion in the first half of 2026, up 23% year-over-year, maintaining positive growth for eight consecutive months. Among them, AI-specific chips (e.g., GPU, ASIC, HBM memory) saw sales surge 67% YoY, contributing over 40% of the total increase. This data set a record for the same period in history, signaling the chip industry entering a new super cycle.
Analysts point out that the core driver of this growth is the large-scale application of generative AI. From cloud training to edge inference, from large models to smart cars, demand for chips as the computing base has exploded. Foundries such as TSMC and Samsung have capacity utilization rates exceeding 95%, and orders for advanced processes below 3nm are scheduled until 2028. Against this backdrop, market attention on the chip industry is unprecedentedly high, with investing in chips becoming a hot topic in the investment community.
National Strategy and Policy Dividends: Accelerating Chip Self-Sufficiency
Chips are not only the food of the tech industry but also a strategic high ground in great power rivalry. Multiple governments continue to ramp up semiconductor localization investments. The second phase of the US CHIPS and Science Act has been allocated, the European Chips Act aims to increase production capacity share to 20% by 2030, and Japan and South Korea have each launched over $100 billion in support plans. In China, the third phase of the National Integrated Circuit Industry Investment Fund (Big Fund III) was officially launched at the end of 2025, with a capital injection of up to 344 billion RMB, focusing on advanced manufacturing, packaging and testing, and equipment materials.
Policy dividends directly drive the domestic substitution process. According to the China Semiconductor Industry Association, the localization rate of China's semiconductor equipment rose to 35% in H1 2026, more than double the 15% in 2020. In key equipment areas such as lithography, etching, and thin-film deposition, some local companies have achieved breakthroughs from 0 to 1. This policy + market dual-drive mechanism has significantly enhanced the performance elasticity of domestic chip supply chain companies.
Technological Breakthroughs: Multi-Dimensional Innovation from Process to Architecture
The investment value of the chip industry is also reflected in new opportunities brought by technology iterations. Although Moore's Law has slowed, new paradigms such as advanced packaging, Chiplet architecture, and heterogeneous computing are reshaping the industry landscape. For example, TSMC's 3D SoIC packaging technology has entered mass production, stacking logic chips with HBM, increasing bandwidth by more than 10 times. Domestic companies like JCET and Tongfu Microelectronics are also deploying in the Chiplet field. In addition, the RISC-V open-source instruction set architecture is rapidly emerging, with RISC-V-based AI accelerator chips showing cost and power advantages in IoT and edge computing.
On the materials side, third-generation semiconductors (GaN, SiC) are accelerating penetration in fast charging and new energy vehicles. According to Yole Group, the global SiC power device market will exceed $5 billion in 2026, with a CAGR of over 30%. These technological breakthroughs offer investors multi-dimensional targets from equipment and materials to design and manufacturing, each segment has high growth opportunities.
Market Demand: Beyond AI, Automotive and IoT Also Deserve Attention
Although AI chips are the biggest highlight, chip demand in other areas is equally strong. Under the trend of automotive intelligence and electrification, the number of chips per vehicle has increased from about 800 in traditional fuel vehicles to over 2,000 in smart EVs. In H1 2026, global automotive chip sales grew 18% YoY, with IGBT, MCU, and sensor categories remaining in short supply. Additionally, with the advancement of 5G/6G communications, satellite internet, and the Internet of Everything, IoT chip shipments are expected to exceed 30 billion units in 2026, bringing massive demand from industrial, medical, and consumer electronics scenarios.
From a market space perspective, the global semiconductor market is expected to exceed $1 trillion by 2030. The current P/E ratio of the chip sector is near its historical median, without excessive bubbles. Many institutions believe that, considering the earnings growth over the next five years, the current valuation offers high cost-effectiveness and is a golden window for positioning.
Investment Logic: Three Main Lines to Deploy in Chip Supply Chain
Based on the above analysis, for the question Why invest in chips?, the investment logic can be grasped from the following three main lines:
- Line 1: Computing Core Focus on AI chip design leaders, advanced foundries, HBM and DDR5 memory chip makers. These companies occupy a core position in the AI large model race, with strong earnings certainty.
- Line 2: Domestic Substitution Track breakthroughs in bottleneck links such as semiconductor equipment, materials, and EDA tools. Domestic policy support is strong, enterprise order growth is fast, and valuations are relatively reasonable.
- Line 3: Application Innovation Focus on automotive-grade chips, IoT chips, Chiplet, and RISC-V ecosystem. These areas benefit from downstream demand explosion, and the technology landscape is not yet settled, offering opportunities to overtake on curves.
Of course, chip investment also faces geopolitical risks, technology iteration risks, and cyclical volatility. But in the long run, the foundation of the digital revolution is chips, and the investment value of this track is unquestionable. For investors, now is a good time to deeply understand the chip industry and select quality targets.
Conclusion: A Ticket to Outpace Inflation and the Tech Wave
Looking back at the past 20 years, the chip industry's gains have ranked among the top in the tech sector. From Intel to Nvidia, from ASML to TSMC, every round of technological transformation has given rise to tenfold or even hundredfold bull stocks. Now, with new variables such as AI large models, autonomous driving, and quantum computing stacking up, the chip industry is standing at a new starting point. For global investors, investing in chips is not only investing in the future, but also a preferred path to embrace deterministic growth. Terry Global Investment Research Institute will continue to track chip industry dynamics, providing investors with in-depth analysis and strategic references.
