Asia Semi Foundry: Diverging Long-Term Outlook Within the Industry

The semiconductor industry has improved significantly since its downturn in 2022-2023. In Q4 2023, the industry saw its first year-over-year (Y/Y) growth after five consecutive quarters of decline. However, the growth of the largest semiconductor end-demand, which includes smartphones, PCs, and consumer electronics, is expected to be limited during this upcycle. We believe that artificial intelligence (AI) will be the next major driver of long-term semiconductor demand growth. To benefit from AI-related semiconductor demand, companies must have top-tier computing power, data processing speed, and energy efficiency.