On July 28, 2026, the World Semiconductor Trade Statistics (WSTS) released its latest report, stating that global semiconductor sales in Q2 2026 reached $178.5 billion, up 18.7% year-over-year, marking the fifth consecutive quarter of positive growth. This figure exceeded market expectations, driven by sustained surge in artificial intelligence (AI) chip demand and memory price recovery.
AI and Memory Dual Engines
The WSTS report shows that Q2 chip sales growth momentum came from multiple areas. AI accelerators (e.g., GPU, ASIC) surged 42% YoY, accounting for 28% of total market. In memory, DRAM and NAND Flash revenue grew 24% and 19% respectively, benefiting from data center expansion and device upgrade cycles. Automotive semiconductors, though slowing to 8% growth, remained stable.
WSTS President John Neuffer stated: "The global semiconductor industry has entered a new upcycle, driven by AI infrastructure investment and recovery in end demand. Looking ahead, full-year sales are estimated at $720 billion, with the annual growth rate revised up to 16.5%."
Regional Performance: Asia Leads Growth
By region, Asia Pacific (including Japan) posted the strongest Q2 sales growth at 21% YoY, with China, Taiwan, and South Korea growing 23%, 19%, and 22% respectively. The Americas grew 15%, while Europe and Middle East only grew 6%, reflecting structural differences.
Singapore, a Southeast Asian semiconductor manufacturing and R&D hub, saw related industry output grow 12% YoY in Q2. The Singapore Economic Development Board (EDB) recently approved two large wafer fab expansion projects led by GlobalFoundries and Taiwan's UMC, with total investment of S$8.5 billion, expected to start production in 2028. This will further strengthen Singapore's strategic position in the global supply chain and bring long-term benefits to locally listed semiconductor blue chips such as Chartered Semiconductor and supply chain players.
Inventory Levels Return to Healthy, Downstream Demand Heats Up
According to WSTS, global semiconductor inventory days dropped to 78 in Q2, close to the historical average (75-80 days), indicating inventory adjustment is largely complete. In downstream applications, PC and smartphone shipments grew 5% and 3% quarter-over-quarter respectively, ending four consecutive quarters of decline. Data center capital expenditure maintained double-digit growth, with cloud providers Microsoft, Amazon, Google increasing AI chip procurement by 35% YoY.
However, industrial and telecom infrastructure chip demand remained relatively weak, with YoY growth of only 2% and 1%, indicating slower recovery in non-AI areas.
Singapore Market Investment Opportunities
For investors, the semiconductor upturn supports blue-chip stocks on the Singapore Exchange (SGX). Chartered Semiconductor, for example, has seen its share price rise 18% in the past three months, with market cap exceeding S$20 billion, reflecting expectations of higher fab utilization. Semiconductor equipment suppliers (e.g., Axcelis Technologies' Asia-Pacific HQ in Singapore) and materials suppliers (e.g., Entegris) are also poised to benefit from expansion opportunities.
Analysts believe that with AI applications spreading from cloud to edge devices and the memory upcycle continuing, the semiconductor sector still has upward momentum in the second half. However, trade barriers and geopolitical risks, especially US export controls on China, may disrupt some supply chains.
Overall, the global semiconductor industry, driven by AI and memory dual engines, is in an expansion phase. With its stable business environment and sustained investment appeal, Singapore will play a key role in this semiconductor recovery, offering investors diversified opportunities.
