Gartner: Semiconductor Revenue to Hit $1.3 Trillion in 2026 as 'Memflation' Drives Record Equipment Demand

By NineScrolls Team · 2026-04-15 · 5 min read · Industry

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Gartner's $1.3 Trillion Forecast

Gartner forecasts that worldwide semiconductor revenue will exceed $1.3 trillion in 2026, representing a 64% year-over-year increase — the strongest growth the industry has seen in more than two decades. The projection, published April 8, marks the third consecutive year of double-digit growth for the global chip market.

The headline figure dwarfs earlier estimates. In January 2026, the Semiconductor Industry Association reported that 2025 global chip sales had reached $88.8 billion in February alone, putting the industry on a trajectory toward $1 trillion. Gartner's updated model now shows the market blowing past that milestone by a wide margin, propelled by converging forces: explosive AI infrastructure investment and a severe memory price shock that analysts have dubbed "memflation."

What Is 'Memflation' and Why It Matters

Memory revenue is projected to triple in 2026, according to Gartner. Annual average prices for DRAM are forecast to climb 125%, while NAND flash prices are expected to surge 234%. The root cause: limited production capacity among the three dominant memory suppliers — Micron, Samsung, and SK Hynix — at a time when AI data centers are consuming memory at an unprecedented rate.

"Memflation will destroy, or at least delay, non-AI demand into 2028, to varying degrees depending on the application," said Rajeev Rajput, Senior Principal Analyst at Gartner. The implication is stark: consumer electronics manufacturers are being priced out of memory supply as hyperscalers absorb available output for AI training and inference workloads.

Gartner does not expect meaningful price relief until late 2027. The firm advises CIOs and IT procurement leaders to avoid long-term supply contracts with unfavorable pricing terms that extend beyond 2027, when the current supply-demand imbalance is expected to ease.

AI Chips Now 30% of the Market

AI-related semiconductors — including GPUs, custom accelerators, and high-bandwidth memory — are expected to account for roughly 30% of total global semiconductor revenue in 2026. Hyperscaler investment in AI infrastructure is forecast to increase by more than 50% this year, driving sustained demand for leading-edge logic chips manufactured at 3nm and 2nm process nodes.

TSMC, the world's dominant contract chipmaker, reported Q1 2026 revenue of $35.7 billion on April 10 — a 35% year-on-year increase — and has guided for record capital expenditure of $52–56 billion for the full year. Approximately 70–80% of that capex is earmarked for leading-edge process technologies, translating directly into orders for deposition, etch, and metrology equipment.

Memory Makers Ramp Capital Spending

The memory price surge is translating into aggressive capital expenditure plans from all three major memory manufacturers. SK Hynix is expected to spend $20.5 billion in 2026, up 17% year-on-year, with a focus on HBM4 capacity expansion. Samsung plans approximately $20 billion in memory-related capex, up 11%, to advance its 1C-process DRAM and HBM production lines. Micron is projected to be the most aggressive investor among DRAM suppliers, with 2026 capex forecast at $13.5 billion — a 23% increase.

Combined, the three companies are on track to spend over $54 billion on memory fab equipment this year. The expansion of 3D NAND production — now pushing past 200 layers — and the evolution of DRAM technology toward sub-15nm nodes have the strongest driving effect on etch and deposition equipment demand, according to industry analysts.

Worldwide semiconductor equipment sales reached a record $135.1 billion in 2025, up 15% from $117.1 billion the prior year, according to SEMI. Equipment sales in Taiwan surged 90% to $31.5 billion, while Korea rose 26% to $25.8 billion. SEMI projects overall equipment sales will reach $156 billion by 2027.

What This Means for Plasma Processing and Thin Film Deposition

The memflation-driven capex cycle is a direct tailwind for plasma processing and thin film deposition equipment. In 3D NAND manufacturing, the share of thin film deposition equipment in the total capital budget has grown from 18% in the 2D era to 26% in the 3D era, according to Tokyo Electron. As manufacturers push toward 200+ layer stacks, each additional layer requires repeated cycles of plasma-enhanced CVD (PECVD) for dielectric films, atomic layer deposition (ALD) for high-k gate oxides, and plasma etch for channel hole formation — processes that scale linearly with layer count.

For DRAM, the transition to sub-15nm nodes and the shift to gate-all-around transistor architectures demand increasingly precise thin film deposition. ALD is critical for depositing uniform, conformal films in high-aspect-ratio structures, while advanced plasma etch is essential for patterning at the angstrom level. Lam Research's DirectDrive etch platform and IBM-Lam collaboration on sub-1nm dry resist processes signal the direction of the technology roadmap.

The equipment supply chain — from plasma sources and RF generators to sputtering targets, vacuum pumps, gas delivery systems, and process monitoring sensors — stands to benefit across the board. With NAND equipment spending projected to reach $15.7 billion in 2026 (up 12.7%) and DRAM equipment spending rising 15.1% year-on-year, vendors of deposition chambers, etch modules, and the components that go into them face a demand environment unlike anything seen since the memory supercycle of 2017–2018 — except this time, the numbers are roughly three times larger.

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