The global semiconductor industry is on track for an exceptional year as investment in artificial intelligence infrastructure reshapes demand for chips, especially memory products.
Gartner now expects worldwide semiconductor revenue to reach about $1.6 trillion in 2026, up 92% from $809 billion in 2025. The research firm also forecasts that the market could grow to roughly $1.9 trillion in 2027, showing that the current AI-led expansion may continue beyond a single investment cycle.networkworld+1
Memory Takes Center Stage
Memory is expected to be the main driver behind the industry’s growth. Gartner projects memory revenue of approximately $837 billion in 2026, compared with $220.1 billion last year. By 2027, the segment could exceed $1 trillion in annual revenue.semiconductor-digest+1
This surge reflects the requirements of modern AI data centers. Large-scale training and inference systems need not only high-performance GPUs and other accelerators, but also vast amounts of DRAM, NAND flash, and high-bandwidth memory. As AI clusters increase in size, every server requires more memory capacity and faster connections between compute and storage resources.
Memory is forecast to account for around 54% of semiconductor revenue in 2026, up from 27% in 2025. Gartner expects NAND flash revenue to rise by 372% and DRAM revenue by roughly 247% during the year.semiconductor-digest+1
Data Centers Redefine Demand
AI data centers are becoming a much larger part of the semiconductor economy. Gartner expects their share of industry revenue to exceed 30% in 2026 and reach about 53% by 2030. This shift means semiconductor value is increasingly concentrated in systems built for large-scale AI processing rather than traditional consumer devices alone.networkworld
Hyperscale cloud providers are continuing to expand spending on AI infrastructure, increasing demand for GPUs, TPUs, networking hardware, storage, power equipment, and optical interconnects. The boom is therefore affecting far more than accelerator vendors: it is also lifting the broader supply chain behind AI servers.
Higher Prices May Persist
The rapid rise in demand is unlikely to bring quick relief for technology buyers. Gartner expects supply conditions to remain tight even as additional manufacturing capacity becomes available. Prices may continue to rise through 2026, with no meaningful improvement expected until late 2027.superpowerdaily
For CIOs and procurement teams, that makes long-term supply agreements more complicated. Securing capacity may be necessary, but locking in unfavorable prices far beyond the current shortage could become costly if market conditions eventually normalize.
The semiconductor market is no longer being driven only by the release cycle of smartphones, PCs, or gaming hardware. AI is creating a new and far more resource-intensive demand pattern — one in which memory, compute, networking, and power infrastructure are all becoming strategic assets.
