November 26, 2024 /SemiMedia/ — The global semiconductor industry showed strong recovery in Q3 2024, with all key metrics posting quarter-on-quarter growth for the first time in two years, according to SEMI's latest report. The rebound was primarily fueled by robust investment in AI data centers, despite slower recoveries in consumer, automotive, and industrial markets. The upward trend is expected to continue into Q4 2024.

Capital expenditure and market dynamics
After a weak first half of 2024, semiconductor capital expenditure (CapEx) rebounded sharply in Q3, with memory-related CapEx surging 34% QoQ and 67% YoY, reflecting significant improvements in the memory market. SEMI projects total semiconductor CapEx to rise 27% QoQ and 31% YoY in Q4 2024, led by a 39% YoY increase in memory investments.

Semiconductor sales and equipment market performance
Electronic product sales grew 8% QoQ in Q3, while IC sales rose 12%. For the full year, IC sales are expected to increase by more than 20%, supported by price recovery and strong demand for memory chips.

The semiconductor equipment market outperformed expectations, driven by increased investments from China and higher spending on high-bandwidth memory (HBM) and advanced packaging. Wafer fab equipment (WFE) spending rose 15% YoY and 11% QoQ in Q3. Meanwhile, the test and assembly/packaging segments posted YoY growth of 40% and 31%, respectively, with momentum expected to carry through the rest of the year.

Wafer capacity expansion
Global wafer capacity reached 41.4 million wafers (300mm equivalent) in Q3 2024, with a projected 1.6% QoQ increase in Q4. Foundry and logic-related capacity showed robust growth, expected to rise 2.2% QoQ in Q4, supported by expansions in both advanced and mature nodes. Memory capacity grew 0.6% in Q3, with similar growth anticipated in Q4, driven by strong demand for HBM, although partially offset by node transitions.

SEMI noted that the semiconductor industry is gradually recovering, with strong CapEx and capacity expansion laying the groundwork for sustained growth, particularly in AI and high-performance computing markets.