Global semiconductor revenue is anticipated to exceed $1.3 trillion in 2026, showing the quickest growth in more than 20 years, as per a report released on Wednesday. The industry is set to witness a 64% growth in 2026, driven by strong demand for artificial intelligence (AI) processing, data center infrastructure, and increasing memory prices. Rajeev Rajput, Senior Principal Analyst at Gartner, mentioned that the semiconductor industry is on track to achieve a third consecutive year of double-digit growth in 2026, fueled by high demand for AI processing, data center networking, power, and memory price inflation.
Total semiconductor revenue is projected to climb from $805.3 billion in 2025 to $1,320.2 billion in 2026, and further to $1,554.5 billion in 2027, according to the report. Memory revenue is expected to almost triple to $633.3 billion in 2026 from $216.3 billion in 2025, primarily due to memory chip price inflation. Gartner’s analysis forecasts a 125% increase in Dynamic Random Access Memory (DRAM) prices and a 234% rise in NAND flash prices in 2026, with significant price corrections unlikely before late 2027.
The report also highlighted that AI semiconductors are predicted to contribute around 30% of total industry revenue in 2026 and will continue as the main growth driver. Spending on AI infrastructure by hyperscalers is estimated to surge by over 50%, driving demand for AI accelerators like GPUs and custom chips. However, the report cautioned that escalating memory prices might postpone demand in non-AI segments until 2028. Rajput advised technology suppliers to brace for higher prices in the first half of 2026, followed by moderated increases throughout the year, urging CIOs and IT leaders to be wary of long-term supply agreements with unfavorable pricing terms.
