Global Semiconductor Equipment Market Continues Strong Momentum
According to the latest "Global Semiconductor Equipment Market Report" released by SEMI, global semiconductor equipment shipments reached $322.3 billion in Q2 2026, up 21.5% year-over-year, hitting a record high for the fifth consecutive quarter. This data shows that despite divergent demand for end electronic products, chipmakers' capital spending remains high, especially the dual-track expansion of advanced and mature process nodes, continuing to inject growth momentum into the equipment supply chain.
Chinese Market Becomes Biggest Highlight, Shipment Share Sets Record
By region, the China market stood out the most, with Q2 equipment shipments reaching $146.2 billion, an astonishing 38.7% year-over-year increase, accounting for over 45% of global shipments, a record high. SEMI analysis points out that driven by China's semiconductor "self-sufficiency" policy, foundries, memory, and power semiconductor manufacturers are accelerating capacity building, focusing especially on mature processes above 28nm to meet domestic demand for automotive, industrial, and consumer electronics. Additionally, US and Dutch export control measures have not completely blocked China from obtaining non-high-end equipment; instead, they have prompted Chinese domestic equipment suppliers to make breakthroughs in areas such as etching and thin-film deposition.
Major Equipment Vendors Orders and Outlook
Dutch lithography giant ASML reported Q2 revenue of €8.26 billion, with orders from Chinese customers accounting for about 36%, up 5 percentage points from the previous quarter. ASML CEO Christophe Fouquet said: "Demand from Chinese customers for mature process equipment is strong, but for High-NA EUV equipment, Chinese orders are still subject to export license restrictions." US equipment giants Applied Materials and Lam Research also benefited from the Chinese market, with their Q2 China revenue shares reaching 42% and 39% respectively; both companies raised their full-year 2026 guidance.
Notably, Chinese domestic equipment suppliers such as NAURA Technology Group and AMEC (Advanced Micro-Fabrication Equipment Inc.) also showed strong growth. According to the China Semiconductor Industry Association, shipments of Chinese domestic equipment in the first half of 2026 reached 65% of the total for the whole of last year, with localization rates for etching equipment and thin-film deposition equipment exceeding 25% and 18% respectively. Although still heavily dependent on imports in the lithography segment, they have achieved substitution capability in cleaning, inspection, CMP, and other processes.
Equipment Market Drivers: AI and Automotive Chip Expansion
Beyond China, global equipment spending growth mainly comes from two directions: first, the expansion of advanced packaging and HBM capacity related to AI chips, with TSMC, Samsung, and Intel expanding CoWoS, InFO, and other advanced packaging capacities, driving demand for back-end testing and packaging equipment; second, continued shortages of automotive chips, especially power semiconductors (IGBT, SiC) and MCUs, prompting GlobalFoundries, STMicroelectronics, and others to build new fabs in Europe and the US, purchasing large volumes of mature process equipment. SEMI estimates that total global equipment shipments in 2026 will exceed $130 billion, with a year-over-year growth rate of about 18%.
Outlook for H2: Geopolitical Risks to Watch
Despite the optimistic outlook, equipment makers also face uncertainties. First, the US may further tighten export controls on semiconductor equipment to China, especially for mature process equipment. If the restrictions expand, it will directly impact the order momentum of ASML, Applied Materials, and other suppliers. Second, the yield and stability of Chinese domestic equipment still need improvement; some fabs report higher failure rates of domestic equipment, which could delay expansion progress if not quickly addressed. Finally, a global macroeconomic slowdown may dampen end demand, with some analysts warning that the equipment market may enter a cyclical correction in 2027.
Overall, the global semiconductor equipment market is in a rare long-term upcycle, with technological progress, geopolitics, and policy drivers from different regions intertwined. Investors should closely monitor quarterly orders of equipment vendors and developments in China equipment bans to grasp industry trends.
