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China to Lead in Chipmaking Investment in 2025, SEMI Reports

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China is set to continue its dominance in global chipmaking investments in 2025, despite a notable year-over-year decline, according to a report from industry group SEMI. The country is expected to outpace all other regions in spending on new computer chipmaking equipment, followed by Taiwan and Korea.

Global Investment Growth

SEMI’s forecast for global fabrication plant investments shows a 2% increase in 2025, reaching $110 billion. This marks the sixth consecutive year of growth, driven largely by the demand for tools needed to produce chips for artificial intelligence (AI). SEMI predicts that the AI boom will have an even stronger impact on the industry in 2026, with an expected investment growth of 18%.

China’s Strategic Push and Decline in Investment

China has been the largest consumer of chips for years, and its chipmaking sector saw a massive push starting in mid-2023. With government support, China has accelerated efforts to reduce its dependence on imported chips, particularly in response to U.S. restrictions. Despite this surge, SEMI forecasts that China’s chipmaking spending will drop by 24% in 2025, falling to $38 billion from $50 billion in 2024. However, this still keeps China ahead of other major chip-producing countries like Korea, where SK Hynix and Samsung are expanding memory chip production, with investments projected at $21.5 billion.

Spending in Other Key Regions

Taiwan, home to TSMC, a major foundry for AI chips, is projected to spend $21 billion on chipmaking equipment in 2025. In comparison, spending in Korea will be significant, but not as high as China’s, with $21.5 billion expected. The Americas and Japan are each expected to invest $14 billion, while Europe’s investment is projected at $9 billion.

Key Players in the Equipment Market

The top players in the chip equipment market include ASML, Applied Materials, KLA, LAM Research, and Tokyo Electron. ASML, the largest chip equipment manufacturer, anticipates sales of €32-38 billion in 2025, maintaining a dominant market share in the lithography sector. Chinese equipment makers, such as Naura, AMEC, and SiCarrier (affiliated with Huawei), are also gaining traction in the market.

Nvidia to Invest Billions in U.S. Chip Production Over Four Years

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Nvidia (NVDA.O) plans to invest hundreds of billions of dollars in U.S.-made chips and electronics over the next four years, CEO Jensen Huang told the Financial Times. The company expects to spend around $500 billion on electronics during this period, with a substantial portion allocated to domestic manufacturing.

Huang emphasized that the U.S. AI industry could expand more rapidly with support from government policies. His comments come as Nvidia seeks to address investor concerns about demand for its high-cost AI chips, especially following the emergence of China’s DeepSeek chatbot as a potential competitor.

While Nvidia declined to comment on the FT report, Huang stated that the company can now manufacture its latest systems in the U.S. through key suppliers like Taiwanese chipmakers TSMC (2330.TW) and Foxconn (2317.TW). He also noted an increasing competitive threat from China’s Huawei.

Huang highlighted that TSMC’s U.S. investments significantly strengthen Nvidia’s supply chain resilience. Earlier, at Nvidia’s developer conference in California, he told analysts that orders for 3.6 million Blackwell AI chips from four major cloud firms likely underestimate actual demand, as they do not account for customers such as Meta Platforms (META.O), smaller cloud providers, and startups.

Intel’s New CEO Lip-Bu Tan Brings Underdog Strategy to Revitalize Chipmaker

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Lip-Bu Tan may not be a household name, but he’s about to become one of the most closely watched figures in technology. As the newly appointed CEO of Intel, Tan steps into a leadership role at a pivotal time for the chipmaker, facing the monumental challenge of revitalizing a company that has long been synonymous with Silicon Valley.

Though largely unknown to the public, Tan brings a wealth of experience and a deep network of industry connections. Intel’s customers, from large tech companies to smaller startups, are all familiar with his work—either through companies he backed as a venture capitalist or businesses he ran in the past.

Tan‘s track record is impressive. He’s rubbed shoulders with top figures in the semiconductor industry like Lisa Su, CEO of Advanced Micro Devices (AMD), and Jensen Huang, CEO of Nvidia. Both companies have surpassed Intel in the AI chip market, and reports indicate they were even approached to invest in Intel, underlining Tan’s status within the tech world.

With Intel’s future under scrutiny, especially from U.S. President Donald Trump, who is eager for the company to succeed, Tan’s leadership will be in the spotlight. Independent analyst Jack Gold believes Tan’s extensive industry knowledge and network give him a significant edge, as long as Intel’s board allows him to implement necessary changes without obstruction.

Shares of Intel surged more than 10% in premarket trading on Thursday, signaling investor optimism about Tan’s appointment.

LEAN OPERATOR AND INDUSTRY INSIDER

At 65, Tan’s career has been shaped by a series of bold moves that helped turn smaller, struggling companies into major players. Born in Malaysia, raised in Singapore, and now a U.S. citizen, Tan’s education in nuclear engineering at MIT and business studies in California set the stage for his future success. In 1987, he founded Walden International, a venture capital firm that made bold investments in startup companies with promising chip designs.

Tan was among the first to recognize that small teams with innovative chip ideas could outpace large incumbents. For example, his investment in Annapurna Labs, a company later acquired by Amazon for $370 million, played a key role in the formation of Amazon’s in-house chip division, which now outpaces Intel’s in some areas. He also invested in Nuvia, which Qualcomm bought for $1.4 billion, marking a major shift in the competition for PC and laptop chips.

Tan’s active role in startups that could either challenge or become acquisition targets for Intel keeps him closely connected to the future of chip technology. Recently, he invested in Celestial AI, a photonics-based AI startup, which also has backing from Intel’s rival, AMD.

TRANSFORMING CADENCE DESIGN SYSTEMS

Tan’s most significant past role was as CEO of Cadence Design Systems, where he took the company from a struggling position to the forefront of chip design. Under Tan’s leadership, Cadence focused on supplying chip design software and partnered closely with Taiwan Semiconductor Manufacturing Co (TSMC), which specializes in chip manufacturing.

During his tenure, Cadence’s stock surged by an astounding 3,200%, with major clients like Apple shifting to in-house chip designs. Cadence’s tools also became integral to chipmakers such as Broadcom, who rely on TSMC for manufacturing chips used by tech giants like Google and Amazon.

Karl Freund, analyst at Cambrian AI Research, praised Tan for successfully aligning Cadence with TSMC, a strategy that paid off handsomely. Freund believes that Tan’s foresight and leadership transformed Cadence into a vital player in the chip design ecosystem.

A PROMISING FUTURE FOR INTEL

As Tan assumes the helm at Intel, he faces a monumental challenge in turning around a company that has struggled to maintain its leadership in the rapidly evolving chip industry. But with his extensive experience and industry relationships, Tan may be well-positioned to tackle the company’s challenges head-on. His underdog approach could prove to be the key to Intel’s revitalization, ushering in a new era for the tech giant.