The increased use of AI technology by many countries and industries has strongly boosted the demand for chips.

The global chip market is expected to grow 11.2% and reach a record high of more than $697 billion in 2025 thanks to strong demand for semiconductor materials needed for smartphones with integrated artificial intelligence (AI) and data centers, according to the World Semiconductor Trade Statistics (WSTS).

In a report released at the end of December, WSTS revised its forecast higher than the $687.38 billion it had given in June last year. This figure is higher than the estimated revenue of the global chip industry of $626.878 billion in 2024.

By product, WSTS forecasts demand for logic circuits – which act as the brains of electronic devices – to rise 16.8% to $243.78 billion. Demand for memory chips – which store data – is expected to rise 13.4% to $189.41 billion.

By region, the Americas are expected to see the largest growth of 15.4% to $215.31 billion, followed by Asia-Pacific, up 10.4% to $376.27 billion. Europe is forecast to see the smallest growth of 3.3% to $53.74 billion.

By product, demand for logic circuits – which act as the brains of electronic devices – is expected to account for the highest revenue share of the industry.

The increased use of AI technology by many countries and industries has strongly boosted chip demand as technology companies race to ensure adequate supply for data centers that support the development of generative AI and AI-powered devices.