Guosheng Securities: AI-Driven Demand for Advanced Silicon Wafers Rises Significantly, Continuing the Recovery Momentum in the Large Silicon Wafer Industry

GOSEN Securities released a research report, stating that, according to SUMCO estimates, the demand for 12-inch silicon wafers from AI servers is 3.8 times that of standard servers. New products and new technologies are driving greater consumption of 12-inch silicon wafers. With the same storage capacity, the demand for 12-inch silicon wafers for HBM is 3 times that of mainstream DRAM products. Currently, the silicon wafer market is dominated by overseas suppliers such as Shin-Etsu and SUMCO, while mainland China companies account for a small share, leaving significant room for market growth. In addition, DRAM supply has already shown signs of shortage. Driven by the pace of demand growth, memory manufacturers have begun to demonstrate willingness to secure future silicon wafer supply. Shin-Etsu Chemical expects that the shipment volume of AI-related silicon wafers will increase significantly in the future.

GOSEN Securities’ main points are as follows:

AI-driven advanced silicon wafer demand grows rapidly; the large-wafer industry continues its recovery momentum

Silicon wafers are the foundation of chip manufacturing, accounting for 30% of the materials used in wafer fabrication. Semiconductor silicon wafers are a key material used to produce semiconductor products such as integrated circuits, discrete devices, and sensors; they are a basic link in the semiconductor industry chain. Their core processes include crystal growth, processing processes, and epitaxial processes, which are highly specialized.

Currently, more than 95% of global semiconductor devices use silicon wafers as substrates, and in integrated circuit products—which account for 80% of semiconductor devices—more than 99% use silicon wafers as substrates. On the basis of silicon wafer substrates, various semiconductor devices are manufactured through multiple processes such as photolithography, etching, thin-film deposition, and ion implantation. In this way, silicon wafers are the foundation of chip manufacturing. According to SEMI statistics, among the nine major categories of wafer fabrication materials in 2024, silicon wafers accounted for 30%, making them the largest material used in wafer fabrication.

Silicon wafers are moving toward larger sizes, and 12-inch is more cost-effective

Semiconductor silicon wafer sizes (by diameter) mainly include 2-inch, 3-inch, 4-inch, 6-inch, 8-inch, and 12-inch. Driven by Moore’s Law, semiconductor silicon wafers are developing toward larger sizes. The larger the wafer size, the more chips can be manufactured on each silicon wafer, thereby reducing the production cost of individual chips.

Under the same process conditions, the usable area of a 300mm semiconductor wafer is more than twice that of a 200mm wafer. Its yield rate (i.e., the number of chips that can be produced per unit wafer) is about 2.5 times that of a 200mm wafer. The per-piece unit price of 12-inch silicon wafers is more than 2.25 times that of 8-inch silicon wafers. With a higher unit price per unit area, and with added value higher and the chip processes more advanced, producing chips using 12-inch silicon wafers can achieve the greatest economic benefits. Generally, process nodes above 90 nanometers mainly use 8-inch and smaller semiconductor silicon wafers, while process nodes at 90 nanometers and below mainly use 12-inch silicon wafers.

AI remains highly buoyant; GPUs and HBM bring incremental demand for 12-inch silicon wafers

Taking AI servers as an example, AI servers add high-performance GPU chips for high-speed parallel computation, and also pair with HBM stack memory to store computation data. An HBM stack is formed by stacking DRAM chips; as the number of stacked layers continues to increase, the consumption of 12-inch silicon wafers is further enhanced. According to SUMCO estimates, the demand for 12-inch silicon wafers from AI servers is 3.8 times that of standard servers. New products and new technologies drive greater consumption of 12-inch silicon wafers. With the same storage capacity, the demand for 12-inch silicon wafers for HBM is 3 times that of mainstream DRAM products. When NAND Flash stacked layer counts increase to 400 layers, manufacturers will switch to a process of producing a complete NAND Flash wafer by bonding 2 wafers to each other, which is equivalent to doubling the demand for 12-inch silicon wafers.

According to SEMI’s estimates, the global semiconductor silicon wafer market size is expected to exceed $20 billion in 2030. Currently, the silicon wafer market is formed by an overseas-supplier monopoly led by Shin-Etsu, SUMCO, and others, while mainland China companies have a relatively small share, leaving significant market space.

Overseas giants look ahead to sustained recovery in the 12-inch silicon wafer market

1. Sumco: The 2025 full-year recovery trend for 300mm wafers is expected to continue. Looking ahead to 26Q1, 300mm wafers should benefit from AI demand and the outlook is optimistic. In the long to medium term, for 300mm wafers, demand for advanced logic chips and DRAM in AI data centers remains strong, and NAND demand is also expected to rebound. For traditional products, customers will fully destock and adjust their procurement volumes.

2. Shin-Etsu Chemical: Demand for 300mm wafers will maintain its recovery trend. AI-related demand continues to be strong, demand in other sectors has also begun to rebound. Looking forward, customers in the AI semiconductor field are stepping up capacity expansion. A surge in AI demand is creating structural change for the industry, and silicon wafer demand will continue to grow. In addition, DRAM supply has already shown signs of shortage. Driven by the pace of demand growth, memory manufacturers have begun to show willingness to ensure future silicon wafer supply. The company expects that the shipment volume of AI-related silicon wafers will increase significantly in the future.

3. slitronic: Looking ahead to 2026, before the inventory adjustment, silicon wafer demand is expected to grow year over year by about 6%, mainly driven by server demand.

Risk warnings

Risks of intensifying market competition; risks of industry volatility; risks of international trade frictions; risks that AI development may not meet expectations.

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