The latest report from the Semi Silicon Manufacturers Group of the Technology Industry Association shows that the silicon wafer industry is ushering in a recovery. In the first quarter of 2026, global silicon wafer shipments surged 13.1% year-on-year, rising from 2,896 million square inches (MSI) to 3,275 MSI in the same period last year. Although it fell 4.7% quarter-on-quarter, this is a seasonal fluctuation in the industry.

Silicon wafer is the basic thin disc-shaped substrate of modern chip manufacturing, with a diameter of up to 300 mm, on which almost all CPUs, memory chips and other semiconductor devices are produced. The health of this market often indicates the direction of the entire industry, long before the finished product reaches the market.

It’s not consumer demand that’s driving this rebound. Semi SMG Chairman Yata Ginji clearly pointed out that AI and data center infrastructure are the dominant forces, and wafer fabs are shifting their production capacity to produce high-bandwidth memory and computing silicon wafers for hyperscale customers.

PC and smartphone shipments were significantly weak in the first quarter, which was directly caused by memory manufacturers prioritizing production capacity towards AI workloads rather than consumer products.

Yada Ginji also emphasized that AI data centers are affecting the demand for silicon wafers for logic (computing) devices, memory chips and even power management devices. Recent reports and industry sources confirm that chip manufacturers and foundries are still struggling to meet supply requests from the AI ​​industry.

Semi report also pointed out that silicon wafer demand has recovered unevenly in different trading regions, with the most significant improvement in the industrial semiconductor field, helping equipment manufacturers digest previously accumulated inventories.

Semi is an industry association representing thousands of companies in the semiconductor, electronic design and manufacturing supply chain. Its subsidiary SMG is responsible for collecting and publishing market intelligence. These reports are designed to raise customer awareness of the many challenges in the silicon industry, which are becoming more severe as the industry increasingly bets on a single source of growth: AI.