Foundry Market Growth Fueled by AI and Advanced Packaging

The global foundry industry is experiencing steady growth, with projections indicating an expansion from $125.56 billion in 2023 to $171.70 billion by 2032, as reported by Credence Research. This growth is driven by a 3.99% compound annual growth rate (CAGR), reflecting the increasing demand for precision metal casting and semiconductor fabrication in sectors such as automotive, aerospace, and industrial machinery.

For readers of eeNews Europe, this trend signifies significant advancements in semiconductor manufacturing, packaging, and localized chip production, all of which play crucial roles in shaping the electronics supply chain and fostering innovation in Europe and beyond.

AI, Advanced Nodes, and Geographic Shifts

The expansion of the foundry market is being fueled by the rapid adoption of artificial intelligence (AI), high-performance computing (HPC), and next-generation communication technologies. The growing demand for AI accelerators, GPUs, and 5G chipsets is prompting foundries to increase capacity and transition to advanced process nodes like 3 nm and 2 nm.

Simultaneously, foundries are making significant investments in heterogeneous integration and chiplet-based architectures to enhance efficiency and flexibility for AI workloads. Advanced packaging technologies, such as 3D stacking and wafer-level integration methods like CoWoS and InFO, are also gaining popularity, enabling the development of denser and more energy-efficient chip designs.

Government initiatives are playing a noticeable role in reshaping the global foundry landscape. Countries like the US, China, and EU member states are providing substantial subsidies to localize semiconductor manufacturing and reduce reliance on foreign fabs. In Europe, the Chips Act is aimed at supporting projects in countries like Germany, France, and Italy, particularly focusing on automotive-grade semiconductors and IIoT applications.

Competition and Emerging Opportunities

Credence Research highlights a moderately consolidated competitive landscape in the foundry industry, with major players such as TSMC, Samsung, and GlobalFoundries dominating the market. Smaller foundries are finding success in mature nodes and specialized markets like automotive and industrial electronics. The report emphasizes that foundries integrating digitalization and sustainability practices are likely to gain a competitive advantage.

Automation and digital foundry technologies, including AI-driven quality control, 3D sand printing, and predictive maintenance, are enhancing yield and energy efficiency while reducing waste. With rising energy costs and stricter regulations, sustainability has become a strategic focus for industry players.

Looking ahead, there are numerous opportunities in high-performance computing, edge AI, and data center applications. Foundries that align with regional incentives and invest in advanced materials and digital manufacturing are poised to capitalize on future growth prospects.