Due to the influence of AI-driven memory capacity spending recovery, sales of Japanese chip manufacturing equipment are expected to grow by 15% in the year ending in March 2025.
According to the Semiconductor Equipment Association of Japan, sales of chip manufacturing equipment in Japan are expected to grow by 15% in the year ending in March 2025, due to the recovery of memory capacity spending driven by AI. The industry organization has raised its annual guidance target from the previous 403 billion yen to 425 billion yen (about 26 billion US dollars).
It is expected that in the year ending in March 2026, an increase in investment by logic chip foundries will push sales up by 10% to 468 billion yen. In the year ending in March 2027, sales are expected to further increase to 5.15 trillion yen.
The increasing demand for AI chips and data centers has expanded chip investment. Memory chip manufacturer SK Hynix plans to invest $7.5 billion by 2028, mainly to meet the demand for high-bandwidth memory (HBM) to support Nvidia's AI accelerator. The HBM market is dominated by Korean companies SK Hynix and Samsung (SSNLF.US), followed by US chip manufacturer Micron (MU.US).
Toshiki Kawai, President of Tokyo Electron and Chairman of SEAJ, said that the increase in guidance targets is mainly due to AI-related investments and growth in China's spending. The United States, China, the European Union, South Korea, and Japan are all increasing their efforts to promote domestic chip manufacturing in order to maintain their lead in the AI competition.
In April of this year, Japan approved a subsidy of about 59 billion yen (about 3.9 billion US dollars) for domestic chip company Rapidus, as part of its efforts to promote semiconductor manufacturing. Japan has promised to provide billions of dollars to Taiwan Semiconductor's first factory in Kumamoto, Japan, and to expand Micron's factory in Hiroshima to produce advanced DRAM.
The United States and its allies (including the Netherlands, Germany, South Korea, and Japan) have been tightening restrictions on China's access to advanced semiconductor technology. China has set up a 34.4 billion yuan (4.75 billion US dollar) investment fund to promote the development of its semiconductor industry.