Global Foundry Output Value Seen Rising 30% in 2027

By Marcus Bennett

AI demand drives the 2027 forecast

Global foundry output value will approach $294.394 billion in 2027 after growing more than 30% in 2026 and a further roughly 30% next year, TrendForce forecasts. The equivalent is approximately NT$9.7 trillion.

At its “AI NEXT Tech Industry Forecast Seminar” on the 5th, semiconductor analyst Chung Ying-ting said AI servers and general-purpose servers would drive the 2027 increase. Order visibility for advanced processes now extends through the end of 2027.

GPU and AI ASIC power consumption is lifting demand for power-management ICs, or PMICs, BCD processes and power components. Some products are moving to 12-inch wafers, but 8-inch production remains important. TSMC and Samsung are reducing 8-inch capacity, which tightens the supply structure further.

Capacity and pricing split by wafer size

TrendForce estimates global average foundry capacity utilization will rise across both major wafer sizes in 2027:

• 8-inch wafers: 90%–95% in 2026, rising to 95%–100% in 2027.
• 12-inch wafers: 85%–90% in 2026, rising to 90%–95% in 2027.

Tight capacity and rising copper and gold costs will push foundries to pass higher prices to customers in 2027. The analyst sees high price-increase acceptance for 8-inch wafers because the shortages are structural. This gives 8-inch production the greatest pricing power in the current price-rise cycle.

For 12-inch mature processes, customer resistance is higher. Chinese capacity expansion and weak smartphone and laptop demand limit pricing gains, so increases should trail those for 8-inch and advanced processes.

Order coverage supports price increases in advanced processes. AI peripheral IC demand and higher input costs give mature processes some pricing room, although less than the constrained 8-inch segment.

TSMC extends its foundry lead

TSMC’s global foundry market share rose from 51% in 2019 to 70% in 2025. Chung expects 76% in 2027. She said: “If we strip out Taiwan Semiconductor Manufacturing's impact on the entire industry, overall the other players will grow roughly 20% year-on-year next year, and that figure is actually slightly better than 2026.”

That forecast points to improving demand among other advanced-process suppliers and second-tier mature-process producers. Foundries are dispersing capacity to address geopolitical risk and customer supply-chain diversification.

TSMC still plans to keep advanced production centered in Taiwan, with an estimated 87% of capacity remaining there in 2027. United Microelectronics and Vanguard International Semiconductor have made Singapore a focal point for overseas expansion. They cite its relatively neutral geopolitical position, government tax subsidies and investment incentives.

At 4nm and below, larger GPU and AI ASIC die sizes and rising shipments are supporting advanced-process demand. TSMC’s relevant production lines will run at full load through the end of 2027.

Three mature-process suppliers gain differently

Eight-inch utilization will sit near 100%, but the leading beneficiaries have different mixes and constraints:

• Vanguard International Semiconductor (5347.TW): Its BCD platform and position in power-management ICs provide a direct advantage. Vanguard and SMIC have relatively complete BCD offerings, and both companies’ 8-inch capacity is essentially allocated for 2027. Supply trails demand, leaving customers unable to add orders easily. VSMC, Vanguard and NXP’s Singapore 12-inch joint venture, is entering volume production. Its first fab has capacity locked under long-term contracts with major customers.
• United Microelectronics (2303.TW): UMC benefits from 8-inch order spillover and improving 12-inch mature-process demand. As Vanguard, SMIC and others approach full capacity, customers are seeking available suppliers. UMC’s 8-inch utilization began recovering in 2026. It is also redirecting resources toward silicon photonics, deep trench capacitors, silicon interposers and wafer-on-wafer stacking.
• Powerchip Semiconductor Manufacturing (6770.TW): Powerchip has no further 12-inch capacity expansion under way. Existing demand and order spillover should push its 12-inch utilization toward full load throughout 2027.

Capacity utilization alone will not determine profit. Each supplier’s result will depend on the size of its price increases, product mix and cost structure.

Consumer demand remains the swing factor

Consumer electronics demand will determine whether the mature-process recovery holds in 2027. Some customers may pull wafer starts into the first half to build inventory because they expect AI demand to absorb capacity.

If end demand fails to recover during the second half, those customers could face inventory adjustments. The market could therefore show strong AI-related demand alongside an uneven consumer-electronics recovery, limiting the benefit of higher 12-inch utilization.

Advanced packaging broadens

TSMC developed CoWoS packaging in 2009, and demand has grown with the expansion of AI processors. CPUs and Ethernet switches are also adopting 2.5D packaging, extending demand for foundry-backed assembly and test.

That work is spilling over to ASE Technology Holding, Siliconware and Amkor. Chung described TSMC’s broader role in wafer production and advanced packaging as the start of the “foundry 2.0” era.

What does this change for foundries and chip buyers?

For foundries, the 2027 setup favors companies with constrained 8-inch capacity, strong BCD exposure and advanced-process order books. TSMC retains the clearest scale advantage. UMC, Vanguard and Powerchip can gain volume, but earnings will depend on price realization, product mix and costs.

For buyers, 8-inch and advanced-process contracts face the strongest increase pressure. 12-inch mature-node buyers retain more leverage because Chinese supply and weak consumer demand constrain suppliers. Buyers should also distinguish utilization gains from profit gains and test second-half demand against inventory built earlier in the year.