A2 Global Electronics’ CEO, Frank Cavallaro, argues 2025 is anticipated to test industry’s resilience and strategic agility as it adapts to surging demands and sector-specific challenges.
Artificial Intelligence and high-bandwidth memory are anticipated to drive semiconductor growth, especially in high-performance computing and data centers. 2025 HBM revenue could increase by 70 per cent, reaching $21 billion as demand for AI accelerators emphasizes the need for rapid processing and high data throughput. Additionally, the rise in hyperscale data centers intensifies the demand for advanced semiconductor solutions. With expanding cloud infrastructures, chip manufacturers will prioritize energy-efficient, high-capacity memory for data centers.
Not all semiconductor segments will experience similar growth. While demand for electric and autonomous vehicles remains strong, the automotive industry is volatile as some manufacturers have paused production on certain electric models due to high inventories. Industrial applications face similar unpredictability and potentially under-supply as fabs shift focus to AI, risking imbalances. Consumer electronics, particularly smartphones and PCs, may grow slower, leading companies to adjust forecasts. Oversupply in traditional memory markets like DRAM and NAND could pressure prices, prompting strategic inventory management.
As fabs prioritize AI and cloud computing, traditional segments like automotive, industrial and consumer electronics could experience shortages, especially in mature technologies. Automotive and industrial demand, driven by EVs, autonomous vehicles and advanced equipment, may face fluctuations, with over-supply if demand cools or under-supply if production resources remain dedicated to AI. In memory markets, the emphasis on HBM and AI-specific products could lead to shortages in traditional memory if demand spikes—or over-supply and price pressures if consumer electronics demand declines.