Even second-hand equipment is now being frantically snapped up.
Since the second half of 2025, the commercial implementation of large models and AI applications has been fully accelerated, directly spurring massive demand for computing power and driving the global chip market to continue rising. From the macro industry data, WSTS forecasts that global semiconductor sales will exceed 1.51 trillion US dollars in 2026, surging 89.9% year on year, of which the sales of memory chips will increase by as high as 249.5% year on year. All signals point to the same conclusion: the global semiconductor industry has entered a white-hot stage of production expansion.
This fact is fully confirmed: leading enterprises across all tracks including memory, logic chips and advanced packaging have continuously increased capital expenditure and rushed to build production lines. SK Hynix has put forward a five-year capacity doubling plan, planning to purchase EUV equipment worth 11.95 trillion won from ASML in 2026. Micron has raised its capital expenditure for fiscal 2026 from 18 billion US dollars to 20 billion US dollars. TSMC maintains its annual equipment investment in the range of 60 to 64 billion US dollars. According to Morgan Stanley's research and forecast on the supply chain, the total demand for CoWoS wafers from key global customers will nearly double from 2026 to 2027. Samsung and Intel have also launched the largest production expansion plans in their decades of operation, and have set up large-scale wafer manufacturing bases in Pyeongtaek of South Korea, Magdeburg of Germany and Arizona of the United States respectively. Google has even raised its 2026 capital expenditure guidance to 195-205 billion US dollars, clearly accelerating the construction of computing power infrastructure and continuously driving the procurement demand for upstream chips and equipment.
In this round of global large-scale production expansion, funds, plants and employees are all in place, but another fundamental problem is difficult to solve: the supply of semiconductor manufacturing, packaging and testing equipment is generally insufficient, and the delivery of the whole industry is in urgent shortage. Kwak Dong-shin, President of the Korea Semiconductor Industry Association, warned in an interview that starting from 2027, there will be a continuous shortage of global semiconductor equipment that cannot be supplied on demand.
Executives of other leading enterprises in the industry also hold the same judgment. Gary Dickerson, CEO of Applied Materials, said bluntly at the May earnings call that many customers have begun to worry about the chip supply gap in 2030, and currently major customers generally provide rolling demand forecasts for eight consecutive quarters.
Continuous Delays in New Equipment Delivery
The large-scale production expansion across the whole industry chain has spurred a boom in equipment procurement. SEMI updated its mid-year industry report in July 2026, significantly raising the expected annual sales of all types of semiconductor manufacturing equipment in 2026 from 131.6 billion US dollars at the beginning of the year to 165.9 billion US dollars, and predicting that the market size will climb to 229.5 billion US dollars in 2028. The scale of equipment sales continues to rise, but the delivery progress of major equipment manufacturers is generally lagging behind. This is because the current shortage of semiconductor equipment is not a conventional periodic supply and demand fluctuation in the industry, but a systematic development bottleneck of the global semiconductor industry formed by the superposition of three layers of shortage factors.
First Layer: The Capacity of Equipment Manufacturers Has Reached Its Peak
The current global semiconductor equipment market is highly concentrated, and five enterprises including Applied Materials, ASML, Lam Research, Tokyo Electron (TEL) and KLA occupy most of the market share. In the past ups and downs of the industry cycle, the production capacity of the five major manufacturers could be flexibly allocated, but now they have ushered in a rare situation of full-load production across the board.
The CEO of Lam Research confessed at Bernstein's annual strategic decision-making meeting: "The availability of clean rooms is the biggest constraint on increasing equipment shipments." Because the construction of a new semiconductor equipment factory, from planning, site selection, factory construction to the operation of the clean room, takes at least two years, while the demand for equipment has multiplied several times in just one year, and the physical ceiling of production capacity has been reached.
The research data of South Korean media ETNEWS in July 2026 shows that the delivery cycle of mainstream models of the five major manufacturers has been extended to 1.5 to 2 times of the original: the etching and thin film deposition equipment that could be delivered in 6 months in the past is now extended to 12 months; the delivery cycle of high-end packaging and testing equipment has even exceeded 18 months. Industry insiders revealed that even equipment manufacturers that expanded their production capacity in advance are already running their production lines at full capacity, while enterprises that did not expand their production capacity in advance continue to face delivery delays.
Under the tight supply, large chip manufacturers such as Samsung and SK Hynix have actively adjusted their procurement strategies, placing equipment orders before their own plants are completed, so as to avoid the situation that there is no equipment available for production after the production lines are completed.
Second Layer: Equipment Manufacturing Faces the Dilemma of Chip Shortage
In addition to the saturated equipment production capacity, there is also a highly contradictory pain point in the industry: the manufacturing of semiconductor equipment itself also requires various types of chips, and the AI computing power market has seized most of the chip production capacity, leading to the cut-off of supporting chips for equipment and restricting equipment production in reverse. Masami Hasegawa, an executive of Tokyo Electron, once said that the data center and AI industries have taken away a large amount of chip production capacity, so the equipment delivery cycle has been continuously extended. Among them, we can clearly perceive the supply bottleneck of the entire supply chain from the current supply and demand situation of three types of core supporting chips.
FPGA chips are the core computing hub of semiconductor testing equipment, which rely on parallel computing power to complete high-speed signal acquisition, multi-channel synchronous testing and real-time judgment of wafer defects, and are indispensable core components for ATE and measurement equipment. AMD took over Xilinx and then dominated the global FPGA market. In order to guarantee the demand of AI accelerators and data centers, the enterprise tilted its advanced wafer production capacity to cloud vendors, and the allocable production capacity for industrial testing equipment has been greatly compressed. A report by South Korean media The Elec in May 2026 pointed out that the priority of chip procurement for data center customers is significantly higher than that of industrial equipment customers, and the industrial end is in a relatively weak position in the allocation of wafer production capacity.
Drive IC is the precision execution unit of testing equipment, which is responsible for outputting standard test levels to the tested chips and collecting pin feedback signals, and is the underlying hardware to realize the detection of chip electrical parameters. The pin driver chips produced by ADI for semiconductor testing equipment have been continuously diverted by automotive electronics and AI edge devices, and the spot supply has changed to more than 10 weeks of delivery, making it difficult for equipment manufacturers to receive the goods in time.
The importance of server CPUs goes without saying. As the main control brain of semiconductor complete equipment, it coordinates equipment process scheduling, massive test data storage and simulation computing. High-end testing and advanced process equipment all rely on high-performance Xeon series to support the operation of the complete machine. However, Intel prioritizes the supply of Xeon CPU production capacity to large cloud service providers, and equipment manufacturers rank low in the procurement order. At the same time, the mass production time of its new generation server CPU Diamond Rapids for AI scenarios has been postponed to mid-2027, which directly affects the R&D and production of high-end testing equipment.
It can be seen that the shortage of equipment chips has changed from a potential risk to a substantial delivery obstacle. Brice Hill, CFO of Applied Materials, said that the enterprise has as many as 2000 component suppliers in global cooperation. Based on this industrial status, it shows that the explosion of AI demand has amplified the vulnerability of the supply chain, and any key link in the supply chain that cuts off the supply will directly interfere with the delivery of complete equipment.
Third Layer: The Process Complexity of High-end Equipment Increases
Even if the chip shortage of equipment is alleviated in the future, the manufacturing process of the new generation of high-end equipment itself is complex, which will also continuously lengthen the delivery cycle.
In the past, the manufacturing process of mature-process etchers or thin film deposition equipment was relatively standardized, but the challenges faced by the new generation of production lines are completely different. HBM requires precise stacking of dozens of layers of DRAM, and Chiplet requires extremely large-scale chip interconnection. These processes put forward unprecedented requirements for the aspect ratio of etching, the uniformity of thin films, and the alignment accuracy of bonding. Therefore, the number of parts per high-end equipment has increased several times compared with traditional models, and the complete machine calibration and performance verification processes have also doubled synchronously.
Data from market research institution Yole shows that the market size of TCB bonding equipment will reach 936 million US dollars in 2030, with an average annual compound growth rate of 11.6%, but the equipment production cycle continues to extend. The industry presents obvious characteristics: the more advanced the equipment process, the more manufacturing links and the longer the delivery cycle, and the largest market gap at present is exactly this type of high-end equipment.
The delivery of all new equipment is under full pressure. Domestic wafer fabs and packaging and testing fabs originally hoped to supplement their production capacity with second-hand equipment, but this once stable alternative supply chain also fell into supply depletion in 2026.
Circulation Channels of Second-hand Equipment Are Fully Tightened
Before the arrival of the AI production expansion boom, leading chip enterprises in Japan, South Korea and Chinese Taiwan maintained a stable rhythm of equipment decommissioning and auction. Second-hand equipment is a highly cost-effective supplementary channel for mature process manufacturers. Samsung, as the enterprise with the largest shipment volume of second-hand equipment in the world, has transferred old equipment for many years; SK Hynix regularly auctions refurbished equipment of the whole process of etching, deposition and testing online; in addition, TSMC and Micron also sell second-hand equipment.
For domestic wafer fabs, the advantages of procuring second-hand equipment are prominent. According to second-hand equipment trade and refurbishment service providers, the price of second-hand equipment is about half of the price of new machines, and the delivery cycle is 3-6 months, which is much shorter than the 12-18 months waiting period for new machines, and it is subject to fewer export control constraints. Therefore, second-hand equipment can also be called the "invisible supply chain" supporting the expansion of domestic mature processes. However, in 2026, the second-hand equipment circulation system is facing rapid adjustment, and a competition around stock equipment is quietly starting.
The demand side of the second-hand market first heated up. As mentioned earlier, the delivery of global semiconductor equipment is generally delayed, and the delivery period of high-end equipment represented by ASML's EUV lithography machine has reached 18 months or even longer. For wafer fabs that urgently need to complete their production capacity in the past two years, the long waiting will bring high opportunity costs, and a large number of procurement demands are forced to turn to the second-hand equipment market. According to feedback from the supply chain, semiconductor equipment manufacturers will recommend customers to purchase refurbished machines through professional second-hand equipment trading platforms when the delivery period is tight.
What is more severe than the expansion of demand is the contraction of the supply side, and multiple factors jointly squeeze the supply of second-hand equipment in the market. First of all, the demand for mature process production capacity of memory and foundries themselves is rising rapidly, and the decommissioned equipment is prioritized for internal deployment to produce power, analog and niche memory chips, so the scale of external auction and disposal decreases accordingly. The core global supply sources of second-hand equipment, such as Samsung and SK Hynix, driven by their own production expansion and spare parts reserve demand, have significantly reduced the number of equipment sold in public auctions, further compressing the supply flowing into the open market.
Secondly, the advanced packaging track has diverted a large number of equipment to be decommissioned. With the mass launch of TCB bonding and CoWoS packaging production lines, some decommissioned front-end process equipment can be adapted to advanced packaging processes such as TSV and RDL after modular transformation, and continue to be used within the enterprise instead of being disposed of externally. A typical example is that TSMC's Zhunan plant has transformed some of its original front-end clean workshops into advanced packaging production lines, and revitalized idle equipment inside the plant at the same time.
At the same time, the continuous expansion of global procurement groups has further amplified the pressure of competing for goods. Emerging markets such as India and Vietnam have planned to build new wafer fabs one after another. Constrained by the delivery period and cost of new machines, second-hand equipment often becomes the main equipment source in the initial stage of their plant construction, making the already tight second-hand supply even more scarce.
Affected by both supply and demand, the price of second-hand equipment has started to rebound after the adjustment at the bottom last year. The quotation of popular mature-process front-end equipment such as ion implantation, etching and CVD thin film deposition has recovered significantly; high-end packaging equipment is even "hard to get one unit", and the scarcity of high-end testing equipment such as probe stations is prominent. According to industry feedback, the inquiry heat for second-hand equipment in good working condition continues to rise, and the scheduling of popular models continues to lengthen.
Under the superposition of multiple factors, second-hand equipment has changed from a stable supplementary channel to a scarce resource, and the competition between domestic and foreign manufacturers is intensifying. For domestic manufacturers, high-quality second-hand machines now also need to compete for capital strength and global supply chain channels, and some small and medium-sized chip manufacturing enterprises will be in a weak position in the competition for goods.
Domestic Equipment Manufacturers Are Facing a Major Test
The delivery of overseas new equipment is indefinite, and the spot supply of second-hand equipment is depleted. The two external production capacity supplementary paths are narrowed at the same time, and the equipment supply of domestic wafer fabs is being emptied layer by layer.
What is more tricky is that overseas semiconductor equipment controls continue to increase. In April 2026, the U.S. Senate and House of Representatives simultaneously promoted the MATCH Act, planning to extend the control scope from EUV lithography machines to all DUV equipment, listing many domestic manufacturers as key supervised facilities, and separate licenses are required for relevant equipment export and after-sales maintenance, with the refusal presumption principle applied. In the same month, the U.S. Department of Commerce issued the "is-informed" administrative letter, forcing Applied Materials, Lam Research and KLA to stop supplying goods to a leading domestic wafer fab, bypassing the complete legislative process by administrative means, and quickly restricting leading domestic manufacturing enterprises from obtaining overseas equipment.
In sharp contrast to the continuous tightening of import channels, the production expansion demand of domestic chip manufacturing and packaging and testing links continues to be released. According to statistics from Shanghai Securities, in the first half of 2026, the total investment scale of new production lines disclosed by enterprises such as A-share wafer fabs, packaging and testing fabs and memory module manufacturers is close to 45 billion US dollars.
Leading domestic equipment enterprises, which were only alternative options in the procurement lists of wafer fabs a few years ago, have now become the core supply force for mature process production lines. The orders for general mature-process equipment of the four enterprises are generally fully booked, and the delivery cycle of high-end customized models adapted to HBM, AI computing power and advanced packaging scenarios continues to lengthen. The explosion of market demand has directly driven the capital market to rise. According to statistics from CLSA, the overall increase of the A-share semiconductor equipment and material sector in the first half of 2026 reached 147%, and nearly 50 stocks in the sector doubled their share prices within the year.
It can be seen from this that the underlying logic of domestic substitution has undergone fundamental changes. In the past, wafer fabs would only import domestic equipment in small batches for trial when domestic equipment had advantages in price and verification cycle, and local equipment was always in a secondary position; now, the procurement of overseas new machines is restricted and the supply of second-hand equipment is scarce, so the procurement priority of local equipment has been forced to move forward, changing from an optional item to a necessary item to ensure the production line is put into operation.
While the industry is expanding at a high speed, the unavoidable structural shortcomings are still prominent. The current domestic breakthroughs are mainly concentrated in the middle and back-end processes and general equipment categories, and the front-end core equipment such as lithography, ion implantation and high-precision testing are still in the long-term technical research stage. Core components such as RF power supplies, vacuum pumps and high-precision sensors are highly dependent on overseas imports. Once the overseas supply chain is cut off, the entire domestic equipment industry chain will face the risk of systematic shutdown. The continuous shrinkage of the second-hand equipment channel makes the industry chain no longer have the time and space for slow development. In this case, domestic equipment is required not only to achieve mass production, but also to ensure long-term stable operation.
Conclusion
Combined with the industrial status described above, it is not difficult to see that this round of mismatch between supply and demand of semiconductor equipment is essentially different from the previous periodic alternation of boom and bust in the industry. This is a long-term structural contradiction spurred by the explosion of AI computing power. From the perspective of the domestic semiconductor industry, what is more urgent is that the buffer period for local enterprises to tackle core technologies and complete the upstream and downstream supporting supply chains continues to shrink. Coupled with the rapid iteration of global chip technology and the continuous increase of overseas technical controls, the threshold for industrial breakthrough is still rising, but the equipment supply gap of major domestic wafer manufacturing enterprises is already imminent.
When "even second-hand equipment cannot be grabbed" becomes a reality, the independent controllability of domestic equipment is no longer a strategic slogan, but a fundamental premise that determines whether the production