6 Semiconductor Trends in 2025: Experts’ View on Chips Future

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Semiconductors are small chips that power various devices, including phones, computers, and cars. In 2025, this industry is changing fast because of new technologies, such as artificial intelligence (AI), 5G, and the need for energy-efficient chips.

These changes are bringing better chip designs, new materials, and smarter ways to make them.

This article will explore the main semiconductor trends, the challenges ahead, and how these tiny chips will keep improving the technology we use every day.

Key Takeaways

  • The outlook for the semiconductor sector in 2025 is one of significant growth despite challenges.
  • Technological developments in AI and high-performance computing will ensure constant demand for high-end semiconductors.
  • For semiconductor trends in 2025, the biggest will be happening in AI processing, automotive, and connectivity.
  • From a sustainability standpoint, the semiconductor industry’s awareness and focus on environmental issues continue to escalate.

Semiconductor Market Outlook for 2025

The semiconductor market outlook is positive, with strong growth expected in the coming years. In fact, the semiconductor market is expected to increase significantly by 2026, with global sales of semiconductor manufacturing equipment predicted to hit $139 billion.

This growth is primarily the result of higher demand for advanced chips and investments in AI technology.

John Leddy, managing director, technology division at JLL Work Dynamics, told Techopedia:

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“2025 will be an interesting year for the semiconductor industry from the surge of everything AI to geo-political tensions and a new administration’s policies; the industry will need to balance the effects these variables will have on chip demand.

“2025 will see new facilities come online, many more data center/fab projects announced, and aging infrastructure currently used in production refreshed with the anticipation of chip demand growth in 2025 and beyond.”

Let’s look deeper at what experts say about the semiconductor industry trends in 2025.

Six Semiconductor Market Trends in 2025

1. Significant Growth Despite Challenges

According to Pini Althaus, CEO of Cove Capital, the outlook for the semiconductor sector in 2025 is one of significant growth.

Althaus told Techopedia:

“AI and high-performance computing are driving much of this growth, while major challenges arise from geopolitical tensions, particularly from China’s export bans on critical minerals such as gallium, germanium, and antimony.”

China’s decision to ban the exports of these minerals has substantial implications, including supply chain disruptions and national security concerns.

“It can also lead to a [semiconductor chip shortage] and increased prices, forcing companies to seek alternative sources for these minerals,” he said.

The US will need to implement measures to counter China’s ban, including mining and processing these minerals domestically, Althaus added. However, given there are very few known deposits that exist in the US, this will be more challenging.

“[As such], collaboration with allied and friendly countries that host deposits of these key resources is going to be absolutely necessary,” he said.

That being said, even in the face of geopolitical issues, the expert is positive about the semiconductor market’s future.

“Technological developments in AI and high-performance computing are going to be in strong demand, ensuring constant demand for high-end semiconductors,” Althaus said.

2. AI Processing, Automotive, Connectivity

For semiconductor trends in 2025, the biggest will be happening in AI processing, automotive, and connectivity, according to Jason Wingate, CEO of Emerald Ocean Ltd.

“AI and cloud computing continue to be a big piece of the pie,” he told Techopedia. “Nvidia continues to dominate with their AI-focused GPUs, essential for processing the massive datasets modern AI requires.”

Dan Trojan, CEO of Axus Technology, said that AI chips are becoming increasingly ubiquitous, and integrating AI/machine learning into the design and manufacture of semiconductors is a far-reaching trend as well.

“These technologies help to optimize production efficiencies, device yields, and predictive maintenance,” he added.

On the automotive side, semiconductors are driving advancements in electric vehicle technology, Wingate said.

“Silicon carbide semiconductors, for example, are crucial for their power systems – they’re used in inverters and onboard chargers,” he added.

According to Richard Herbert, director of business development and marketing at Ethernovia Inc., as these advanced, autonomous, and software-defined vehicles come closer to market, a major semiconductor trend for 2025 will be the launch of automotive hardware capable of meeting the data and bandwidth this advanced software demands.

Herbert told Techopedia:

“Evolving automotive architecture to realize the ‘connected car’ will enable agnostic data processing, through an intelligent switch to, for example, a central compute unit, a distributed compute unit, an optimized AI engine, an anonymous vehicle internet connection or a black box recorder.”

In addition, the connected world is demanding more, Wingate noted.

“5G and 6G development and rollouts all need advanced semiconductors for processing and managing high-speed data transfers, vital for both base station and mobile devices,” he said.

Jonathan Klamkin, CEO and director at Aeluma, agreed, saying:

“In 2025, the semiconductor industry will undergo transformative growth driven by the demands of AI and electrification.”

Investments are being made in technologies that can scale and handle more demand. High-performance chips will be key to powering the next generation of applications, such as mobile, AR/VR, optical interconnects for data centers and AI, autonomous systems and robotics, 5G/6G wireless communication, advanced sensing, and quantum computing, according to Klamkin.

“Companies are addressing these demands through innovative platforms that integrate compound semiconductors with large-diameter silicon wafers, delivering cost-effective, high-performance solutions at scale,” he added.

This approach is aimed to satisfy the increasing demand for energy-efficient systems designed for AI while also supporting important industries, such as defense, aerospace, and automotive, where top performance and reliability are essential, Klamkin said.

“As global markets evolve, the ability to scale semiconductor production while maintaining next-gen innovation will define the leaders in this space,” he noted.

3. MEMS Takes a Giant Step Forward

Microelectromechanical systems (MEMS), part of the broader semiconductor sector, is preparing to take a major step forward in 2025 with the adoption of 300mm wafers – an innovation that builds on lessons learned from the semiconductor industry’s transition two decades ago, said Jessica Gomez, founder, and CEO at Rogue Valley Microdevices Inc.

“Semiconductor manufacturers began leveraging 300mm wafers in the early 2000s, streamlining production and reducing costs, establishing a foundation for rapidly scaling technologies,” she said.

In contrast, MEMS manufacturers have largely been limited to fabricating devices on smaller wafer sizes.

“The move to 300mm wafers is poised to revolutionize MEMS manufacturing by introducing higher levels of automation and cost-efficiency,” Gomez told Techopedia.

4. A New Era for US Chips

2025 is going to be a pivotal year for the semiconductor industry, said Aaron Ritchie, SVP, business development at strategic partnerships at Smoothstack. Fueled by the CHIPS and Science Act of 2022, the US is poised to become a significant producer of high-tech microchips.

“Currently, most microchips used in products critical to the US economy, e.g., cars, airplanes, medical equipment, defense systems, data centers, etc., are produced outside of the US,” he said. “The aim is to create the infrastructure and workforce to produce these high-tech chips in the US.”

Many semiconductor companies are currently constructing “mega-fabs,” manufacturing plants significantly larger than existing microchip fabrication facilities, Ritchie said.

“The resources to accomplish this will come from the CHIPS Act and chipmakers themselves,” he told Techopedia. “One of the critical aspects of this effort will be the ability for chipmakers to ramp up massive construction efforts and establish a process to produce the required number of employees to run and operate the mega-fabs.”

Chipmakers need various ways to find skilled workers, Ritchie noted. A new method called hire-train-deploy helps recruit people from diverse backgrounds and identifies those with the essential skills needed to succeed in mega-fab environments and then training them to work in those environments.

“The next 12 months will see semiconductor tool vendors, chip designers, and fabs laying the groundwork for this significant expansion,” he said.

5. Sustainability Top of Mind

Today, companies are facing increasing pressure to reduce their environmental impacts because of higher energy costs, stricter regulations, and growing demand from consumers for greener products.

“From a sustainability standpoint, the semiconductor industry’s awareness and focus on environmental issues continues to escalate,” said Trojan.

“Companies are increasingly developing materials that generate less waste and are using renewable energy sources in their manufacturing processes.”

6. Semiconductor Innovation Fuels On-Device AI for Vision

Vision AI is transitioning rapidly from cloud-based devices, said Jim Lenox, vice president US for the system solution group at Sony Semiconductor Solutions. Traditionally, images and videos captured by cameras were sent to the cloud for AI analysis, allowing businesses to gain insights for operations, such as retail and warehousing.

“Now technology has reached a point where we can run AI and the imaging processing all together, on the same chip on the same device,” Lenox told Techopedia.

“This shift offers significant advantages – very fast performance, very low power consumption, reduced form factor, and all sorts of cost avoidance since you’re no longer connecting and sending a lot of data to a cloud somewhere.”

The Bottom Line

Semiconductors are essential for the technology we use every day. With better designs, new materials, and smarter ways to make them, these chips will keep improving.

Although there are still challenges, such as supply problems and high costs, the industry is moving forward. In the years to come, these tiny computer chips will improve our devices and help build a more connected and eco-friendly world.

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Linda Rosencrance
Technology Journalist
Linda Rosencrance
Technology Journalist

Linda Rosencrance is a freelance writer and editor based in the Boston area, with expertise ranging from AI and machine learning to cybersecurity and DevOps. She has been covering IT topics since 1999 as an investigative reporter working for several newspapers in the Boston metro area. Before joining Techopedia in 2022, her articles have appeared in TechTarget, MSDynamicsworld.com, TechBeacon, IoT World Today, Computerworld, CIO magazine, and many other publications. She also writes white papers, case studies, ebooks, and blog posts for many corporate clients, interviewing key players, including CIOs, CISOs, and other C-suite execs.