The market has begun to look at silicon carbide with new eyes.
Silicon carbide has suddenly become popular again.
Wolfspeed, which filed for bankruptcy just a few months ago, announced on September 11th that its 200mm silicon carbide material products have officially entered commercial use after its reorganization plan was approved by a US court. Previously, these products were only supplied on a trial basis to a few customers, but now they are fully available on the market. The company also simultaneously launched 200mm silicon carbide epitaxial wafers that can be immediately certified.
On September 15th, Hong Seok - jun, vice president of Samsung and head of the silicon carbide business team, said that the company is focusing on the research and development of 8 - inch silicon carbide power semiconductors. Although a commercialization timetable has not been announced, he pointed out that Samsung is working hard to "as soon as possible" commercialize silicon carbide power semiconductors.
The Busan city government announced on the 17th that the new headquarters and production facilities of the EYEQ laboratory in Gijang, Busan, have been completed. It is reported that this factory, with an investment of 100 billion won, enables South Korea to fully achieve localized production of 8 - inch SiC power semiconductors for the first time.
Meanwhile, domestic silicon carbide - related manufacturers have also made their own progress.
In the first half of this year, the silicon carbide market was deeply mired in the quagmire of "overcapacity" and "price war". However, now silicon carbide seems to have found a new track and is expected to achieve a "glorious transformation".
What has happened to silicon carbide?
Silicon carbide, a turnaround in the past six months
Entering 2025, the core challenge facing the silicon carbide industry is that the growth rate of supply exceeds that of terminal demand. Driven by the active investment of global manufacturers, the production capacity of silicon carbide substrates has expanded rapidly. According to industry institutions' forecasts, in 2025, the annual global production capacity of silicon carbide substrates is expected to reach 4 million pieces, while the market demand forecast for the same period is about 2.5 million pieces.
The significant imbalance between supply and demand has directly led to fierce competition in market prices. Taking the mainstream 6 - inch silicon carbide substrates as an example, their market prices dropped by more than 40% in 2025, and some quotes have approached the cost lines of many producers. This round of price decline reflects the cyclical adjustment of the industry after the previous high - speed growth.
Against this market background, the operations of relevant enterprises face challenges. Wolfspeed, one of the industry leaders, is a typical case. The company has invested billions of dollars in large - scale production capacity expansion in the past few years, especially in forward - looking investments in 8 - inch wafer technology. However, due to the slowdown in the growth rate of electric vehicle demand in the European and American markets, technical challenges in improving the yield rate of 8 - inch wafers, and intense global market price competition, the company's financial situation has been under continuous pressure. In June 2025, Wolfspeed filed for Chapter 11 bankruptcy protection with the US Bankruptcy Court for the Southern District of Texas.
Similar business difficulties and strategic adjustments of enterprises mark that the silicon carbide industry has entered a stage of capacity reduction and market integration, and the situation of excess supply is expected to be gradually alleviated.
While the traditional application market is in an adjustment period, the AI field has brought unexpected new opportunities for silicon carbide. On September 5th, it was reported that to improve performance, NVIDIA plans to replace the intermediate substrate material in the CoWoS advanced packaging process of its new - generation Rubin processor from silicon to silicon carbide in its development blueprint. Currently, TSMC has invited major manufacturers to jointly research and develop the manufacturing technology of silicon carbide intermediate substrates. NVIDIA's first - generation Rubin GPU will still use a silicon intermediate substrate, but according to the company's plan, at the latest by 2027, silicon carbide will be used in advanced packaging.
Silicon carbide has also been found to be applicable in data centers. On May 20th, NVIDIA announced that it will be the first to transition to the 800V HVDC data center power infrastructure and has reached relevant cooperation agreements with Infineon and Navitas, aiming to further reduce the power consumption of data centers. It is reported that this innovation in the power supply architecture will require the use of a large number of silicon carbide and gallium nitride devices.
In addition, the application of silicon carbide materials in the field of AR glasses is also gradually being discovered by the market.
But why silicon carbide?
Advanced packaging, data centers, and AR glasses
Let's first look at the application of silicon carbide in advanced packaging.
As the demand for computing power in artificial intelligence and high - performance computing continues to rise, chip design is facing a severe physical bottleneck: in advanced packaging architectures such as 2.5D, the traditional silicon - based interposer connecting the processor core and high - bandwidth memory has gradually been unable to meet the dual requirements of heat dissipation and data transmission for next - generation chips.
When the power consumption of a single chip approaches 1000 watts or even higher, the huge heat generated and the extreme requirements for signal integrity prompt the industry to seek alternative materials with better performance, and this is where silicon carbide's advantages lie.
The most core advantage of silicon carbide lies in its excellent thermal management ability. The thermal conductivity of traditional silicon interposers is only about 150 W/m·K. Facing a large heat flux density, the heat dissipation efficiency is low, which easily leads to an excessively high core temperature of the chip, resulting in performance degradation or affecting long - term reliability. In contrast, the thermal conductivity of single - crystal silicon carbide is as high as 490 W/m·K, more than three times that of silicon materials.
This means that using silicon carbide as an interposer can transform this component from a passive carrying platform into an efficient "heat sink", which can quickly and evenly conduct the concentrated heat generated by the chip, significantly reducing the critical operating junction temperature and providing a solid physical guarantee for the processor to operate stably at the limit power.
In addition to its excellent heat dissipation performance, silicon carbide also shows great potential in electrical characteristics and structural design. High - frequency signals are easily affected by parasitic inductance and signal crosstalk when transmitted in dense circuits, thus limiting the data transmission speed. Silicon carbide materials not only have excellent electrical insulation properties but also allow the manufacture of vertical via structures with a higher aspect ratio through advanced etching processes.
This structural advantage allows the internal interconnection paths to be designed shorter and more densely, thereby significantly reducing the parasitic inductance that limits the data transmission speed and ensuring signal integrity. This ultimately translates into a faster and more reliable data exchange channel between the processor and memory, which is the key to meeting the massive data throughput requirements of AI applications.
The thermal management ability and electrical characteristics of silicon carbide can also be applied in the field of data center power supply. The core bottleneck in the development of current data centers lies in the huge energy consumption of AI servers. The traditional 48V/54V power supply architecture has significant energy losses in the multi - level voltage conversion process from the power grid to the chips, resulting in low efficiency and a heavy heat dissipation burden. To address this challenge, the industry is promoting an innovation towards the 800V high - voltage direct - current (HVDC) architecture, aiming to simplify the power supply link and reduce losses.
In this regard, the advantage of silicon carbide lies in its extremely high power conversion efficiency. The new 800V architecture relies on key components such as solid - state transformers (SSTs) and high - voltage direct - current converters. In scenarios where high - frequency and high - voltage switching are required, the switching losses of traditional silicon - based devices (such as IGBTs) are huge. In contrast, the switching energy consumption of silicon carbide MOSFETs is more than 20 times lower than that of the former, which means that less energy is wasted in the form of heat during each power conversion. This characteristic can improve the overall system energy efficiency of data centers from cabinets to servers by several percentage points, effectively saving huge operating power costs.
Meanwhile, the efficiency advantage of silicon carbide can give rise to a higher power density. Due to extremely low self - losses, the waste heat generated by silicon carbide devices is significantly reduced, thus greatly reducing the requirements for their heat dissipation systems. This enables the volume and weight of power modules such as power supply units (PSUs) to be significantly reduced, and the power density to be doubled. In data center cabinets where space is at a premium, a higher power density means that more AI accelerators can be powered in the same space, directly improving the efficiency of overall computing power deployment. At the same time, the high - voltage and high - temperature resistance of silicon carbide materials also ensures the long - term stable and reliable operation of the entire 800V power system under high loads.
For this reason, many silicon carbide enterprises expect that by 2030, the solid - state transformer segment of 800V data centers will create a market opportunity of about $500 million per year for silicon carbide devices. Meanwhile, solid - state transformers based on silicon carbide will also be applied in many fields such as charging stations and micro - grids. According to the speculation of the UK's CSA Catapult, it is expected that by 2030, the solid - state transformer market will grow at a double - digit compound annual growth rate (CAGR), and more than 500,000 substations in the UK alone are expected to be upgraded with silicon carbide solid - state transformers.
In addition, AR glasses are also a field where silicon carbide can "shine".
Currently, the AR (augmented reality) smart glasses industry is moving towards the critical stage of consumer - level popularization, but its development has long been limited by several core technical bottlenecks: narrow field of view (FOV), rainbow artifacts in images, and problems such as heat generation and short battery life due to high power consumption. The root causes of these challenges largely lie in the material limitations of the core optical component - the waveguide lens. For this reason, the industry is turning to silicon carbide. Silicon carbide has excellent optical properties and structural stability. The immersive experience of AR glasses directly depends on the size of the FOV. Traditional glass or resin materials have a relatively low refractive index (about 1.8 - 2.0). To achieve a large FOV, the lenses must be made thick and heavy. The refractive index of silicon carbide is as high as 2.6 - 2.7, which can achieve a wide FOV of more than 70 degrees on a single - layer, ultra - thin lens, solving the problem of device bulkiness at the physical level. At the same time, silicon carbide has an ultra - high hardness second only to diamond, which enables it to maintain extremely high structural accuracy during the nanoscale grating etching process, effectively suppressing rainbow artifacts caused by material deformation or processing errors and significantly improving the imaging quality.
Secondly, still relying on excellent thermal management and electrical efficiency, silicon carbide is expected to solve the functional problems of AR glasses. Micro - displays such as MicroLEDs in AR devices need to maintain high - brightness output to ensure outdoor visibility, but this will generate a large amount of heat, affecting the lifespan and stability of components. The thermal conductivity of silicon carbide is more than a hundred times higher than that of traditional glass and can be used as an efficient heat dissipation substrate to quickly conduct the heat generated by the display core. In addition, the higher conversion efficiency of silicon carbide in the power management unit helps to extend the device's battery life, providing support for achieving the ultimate goal of "all - day wearing".
Domestic manufacturers are making efforts
Facing these "promising" markets, domestic silicon carbide manufacturers have naturally taken actions.
On September 17th, San'an Optoelectronics Chairman Lin Zhiqiang revealed at the company's online performance briefing that in the field of AI/AR glasses, San'an Optoelectronics' Micro LED products are cooperating with domestic and foreign terminal manufacturers for solution optimization and have moved from the technical verification stage to the small - batch verification stage.
It is reported that Hunan San'an, a subsidiary of San'an Optoelectronics, is one of the few vertically integrated manufacturing platforms for the entire silicon carbide industry chain in China. The industry chain includes crystal growth, substrate preparation, epitaxial growth, chip manufacturing, and packaging testing. The products have been widely used in fields such as new - energy vehicles, photovoltaic energy storage, charging piles, AI, and data center servers. Currently, Hunan San'an has a supporting production capacity of 16,000 pieces per month for 6 - inch silicon carbide, a production capacity of 1,000 pieces per month for 8 - inch silicon carbide substrates, and a production capacity of 2,000 pieces per month for epitaxial wafers. Its 8 - inch silicon carbide chip production line was put into operation in Q2 of 2025.
On September 11th, Tianyue Advanced said on the interactive platform that the company's silicon carbide substrates can be widely used in downstream products such as power semiconductor devices, radio - frequency semiconductor devices, optical waveguides, TF - SAW filters, and heat - dissipation components. The main application industries include electric vehicles, photovoltaic and energy - storage systems, power grids, rail transit, communications, AI glasses, smartphones, semiconductor lasers, etc. The company's silicon carbide substrates are made into power electronic devices by customers, and these devices are ultimately applied in terminal products in multiple fields such as electric vehicles, AI data centers, and photovoltaic systems.
Tianyue Advanced was founded in 2010 and focuses on the research, development, and production of silicon carbide semiconductor materials. Currently, Tianyue Advanced is one of the few companies in the world that can achieve mass production of 8 - inch silicon carbide substrates and was the first to commercialize 2 - inch to 8 - inch silicon carbide substrates. It also globally launched 12 - inch silicon carbide substrates in November 2024. According to data, in terms of the sales revenue of silicon carbide substrates in 2024, Tianyue Advanced is one of the top three silicon carbide substrate manufacturers in the world, with a market share of 16.7%.
On September 9th, Jingsheng M&E issued an announcement on the record of investor relations activities, stating that the company's silicon carbide substrate material business has achieved large - scale mass production and sales of 6 - 8 - inch silicon carbide substrates. The core parameter indicators of the mass - produced silicon carbide substrates have reached the first - class level in the industry, and it has achieved a breakthrough in the 12 - inch conductive silicon carbide single - crystal growth technology, successfully growing 12 - inch silicon carbide crystals. At the same time, the company is actively promoting the customer verification of silicon carbide substrates globally, significantly expanding the scope of sample - sending customers. The product verification is progressing smoothly, and it has successfully obtained bulk orders from some international customers.
Jingsheng M&E was founded in December 2006. The company provides equipment for the photovoltaic and semiconductor industry chains around three major semiconductor materials: silicon, sapphire, and silicon carbide, and extends to the field of compound substrate materials. Its main products include various crystal growth furnaces and silicon wafer processing equipment. In addition, Jingsheng M&E also has relevant businesses in semiconductor silicon wafer materials.
Conclusion
According to Yole's prediction, the global market size of silicon carbide power devices will reach $6.297 billion in 2027; TrendForce data shows that its compound annual growth rate (CAGR) from 2023 to 2028 is as high as 25%; Frost & Sullivan further predicts that the global market size of the silicon carbide substrate end will grow to RMB 66.4 billion in 2030.
The successful "transformation" of silicon carbide undoubtedly stems from the suitability of its material characteristics for fields such as AI and new energy. And the demand brought by the new market will undoubtedly trigger fierce competition among domestic and foreign manufacturers.
This drama that foreshadows the future has just begun.
This article is from the WeChat public account "Semiconductor Industry Insights" (ID: ICViews), author: Junxi, published by 36Kr with authorization.