[News] Booming GPU and HBM Demand Pushes Japanese Chip Equipment Annual Sales to Record High

With the widespread adoption of AI, the demand for GPUs and high-bandwidth memory (HBM) is soaring. The Semiconductor Equipment Association of Japan (SEAJ) has revised its forecast for sales of Japanese-made semiconductor equipment, predicting that for the first time in history, sales will exceed JPY 4 trillion in the 2024 fiscal year. It is also estimated that sales will further exceed JPY 5 trillion in the 2026 fiscal year.

Per a report by Nikkei on July 5th, SEAJ’s forecast report indicates that for the 2024 fiscal year (April 2024 to March 2025), the sales of Japanese-made chip equipment (including sales by Japanese companies both domestically and overseas) have been revised from the previous estimate of JPY 4.0348 trillion (in January 2024) to JPY 4.2522 trillion, marking a significant increase of 15.0% compared to the 2023 fiscal year.

This will be the first time in history that annual sales exceed JPY 4 trillion, setting a new record. The main reason for this growth is the widespread adoption of AI, which has led to a strong demand for GPUs used in AI servers and a continuous surge in demand for HBM used in conjunction with them.

Reportedly, SEAJ stated that, due to anticipated steady investments in logic/foundry and memory, the sales forecast for Japanese chip equipment in the 2025 fiscal year (April 2025 to March 2026) has been revised upward from JPY 4.4383 trillion to JPY 4.6774 trillion, representing a 10.0% year-on-year increase.

Additionally, the demand for chip equipment is expected to be driven by AI-related semiconductors, resulting in a projected 10.0% year-on-year increase in sales for the 2026 fiscal year, reaching JPY 5.1452 trillion. This will mark the first time annual sales exceed JPY 5 trillion.

The compound annual growth rate (CAGR) for Japanese chip equipment sales during the 2024-2026 period is estimated to be 11.6%. Japan’s global market share for chip equipment (in terms of sales) is approximately 30%, making it the second-largest in the world, following the United States.

SEAJ has indicated that in addition to servers, AI will be integrated into into PCs and smartphones at a faster pace in the near future. SEAJ President Toshiki Kawai mentioned that by 2027, 30-40% of PCs and smartphones are expected to incorporate AI, which is anticipated to have a more significant impact on increasing the demand for chip equipment compared to servers.

Toshiki Kawai further mentioned that as the self-sufficiency in manufacturing equipment remains insufficient in the Chinese market, the demand remains consistent and robust for Japanese-made equipment.

On June 25th, SEAJ released statistics indicating that in May 2024, Japan’s semiconductor equipment sales (3-month moving average, including exports) reached JPY 400.954 billion. This marked a significant increase of 27.0% compared to the same month last year, marking the fifth consecutive month of growth and the largest increase in 19 months (since October 2022, with a growth of 27.6%).

Monthly sales exceeded JPY 300 billion for the seventh consecutive month and surpassed JPY 400 billion for the first time in history, setting a new monthly sales record (previously, the highest record was JPY 389.106 billion in April 2024).

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(Photo credit: TEL)