A new wave of price hikes in the semiconductor industry is coming!

At the start of the second half of this year, the semiconductor market not only failed to see the traditional off-season price correction but instead sparked a wave of price increases sweeping across the entire industry chain.

Since July, nearly 20 domestic and international semiconductor giants have collectively issued price adjustment letters. From power devices to memory chips, from wafer foundry to advanced packaging, a general price increase trend has been established. Under the dual pressure of the AI computing power explosion and rising costs, the industry has once again witnessed the boom of "orders booked five months ahead," marking the official entry of the semiconductor industry into its second strong price increase cycle of the year.

Price adjustments concentrated in July, with the entire industry chain following suit

Entering July, the global semiconductor industry has ushered in its second concentrated price adjustment window of the year. Starting July 1, domestic companies such as Silan Integrated, Yangjie Technology, Silan Micro, Starpower Semiconductor, and Juchen Shares, along with international giants like Infineon, Texas Instruments, and STMicroelectronics, have simultaneously initiated price hikes, covering power semiconductors, analog chips, logic chips, memory, wafer foundry, and advanced packaging. Some manufacturers have already experienced their second round of price increases this year.

On June 30, Xinlian Integration issued a letter stating that due to rising costs, coupled with the explosion in demand for AI, new energy, and other sectors, as well as continued capacity constraints, product prices will increase by 15% to 25% in the third quarter of 2026; Yangjie Technology will raise prices across the board by 10% to 15% starting July 1; Silan Microelectronics will increase prices for various electronic product lines by 15% or more; StarPower Semiconductor will raise prices for power modules and discrete devices such as IGBT and SiC MOSFET by 15% or more; Juchen shares will uniformly increase the supply price of Nor Flash by 25%, effective July 6. On the overseas side, Infineon will raise prices for AI server power chips, automotive-grade IGBT, and high-voltage MOSFET by 10% to 20% starting July 1, while Texas Instruments and STMicroelectronics have simultaneously initiated a second round of price adjustments.

Memory and logic chips are also being drawn into the upward price channel. Nearly 20 global analog and power semiconductor companies initiated a new round of price increases on July 1, with multi-tiered adjustments within the year; the siphon effect of AI computing power on high-end memory such as HBM is leading to a structural hard gap in the supply of general-purpose DRAM and NAND that could last up to three years, with high memory prices expected to persist at least until 2027.

Qualcomm has notified all customers on July 24 local time that shipments of all chip series will implement new prices starting September 1, with an overall increase of double-digit percentages. Downstream sectors such as smartphones, wearables, and smart cars face continued pressure for price hikes.

The wafer foundry and packaging & testing sectors are also following the price increase trend. The impact of price hikes by foundries like TSMC covers all process nodes of 7nm and below, with estimated increases of 5% to 10%; ASE announced another price increase for advanced packaging quotes, with the highest increase exceeding 20%, covering categories such as CoWoS and FoCoS.

Supply and demand resonate, capacity bottlenecks are difficult to resolve in the short term

The price increase engine comes from two ends: one end is the comprehensive rise in wafer foundry, silicon wafers, packaging materials, bulk metals, and logistics costs; the other end is the simultaneous explosion of demand from AI data centers, new energy vehicles, and photovoltaic energy storage. The power semiconductor usage in a single AI server is more than three times that of a traditional server, and some high-end models reach more than five times. The capacity of 8-inch mature process nodes continues to shrink, with the global average utilization rate of 8-inch wafer foundries expected to rise to 85% to 90%. Some foundries have already raised prices by 5% to 20%, and the capacity bottleneck is directly transmitted to the end market.

Guo Tao, Deputy Director of the China Electronic Commerce Expert Service Center, stated: 'The price increase of power semiconductor products is mainly driven by the dual factors of rising costs and demand explosion. Currently, power semiconductor companies are entering a development opportunity period characterized by an upward industry cycle and a simultaneous increase in product volume and price.'

Hu Yang, chief analyst of the electronics industry at Southwest Securities, stated that the supply-demand tension in the power semiconductor industry will persist for some time. On one hand, this is due to demand, such as the current photovoltaic and energy storage sectors, as well as modules related to AI data center power supplies, which also require power semiconductors. On the other hand, from the supply side, given the overall tightness in mature process nodes, the supply of power semiconductors is limited. The situation is not expected to ease until next year, or even the second half of next year.

Orders are booked months ahead, and the industry enters an upward cycle

Industry insiders indicate that due to the sustained surge in demand from downstream AI computing power, new energy vehicles, and energy storage, the supply-demand pattern in the power semiconductor market remains tight.

At a power semiconductor company in Chuzhou, Anhui, production lines running two shifts still cannot meet demand, with orders on hand scheduled for delivery four to five months later. AI hardware manufacturers in Shenzhen report that scarce materials require price premiums or even cash purchases, with lead times extended from 8-12 weeks to over 30 weeks. A head of a power semiconductor distribution company stated that the sales side has evolved from "price increases" to a coexistence of "price increases and shortages," with priority allocation of goods to top-tier customers. Additionally, some voices indicate that buyers are currently stocking up by 20% to 30% above actual demand, further exacerbating the tight situation.

ICBC Credit Suisse Fund believes that, driven by the combined effect of AI computing power growth and structural capacity contraction, as market demand for high-performance power devices further releases, the power semiconductor industry may see a new wave of price increases in the second half of the year, ushering in an upward cycle for the sector.