As one of the dominant players in the AI sector, China is set to embark on large-scale AI infrastructure buildouts throughout 2026. The Computing & Data Storage Categories are projected to grow by 126% year‑on‑year, accounting for 62.9% of the total application market. By comparison, the global semiconductor market is expected to surpass $1.6 trillion in 2026, with Computing & Data Storage representing 60.7% of the total. This indicates that China's semiconductor industry is evolving in lockstep with global trends, fully entering an AI‑driven technological era.

Omdia Q2 2026 Data Shows Sharp Upgrade to China Semiconductor Market Forecast

According to the latest findings from Omdia's AMFT – China Region: Semiconductor Application Market Forecast Tool, Q2 2026 report, China's semiconductor market is now projected to grow 92.9% year‑on‑year in 2026, reaching $812.08 billion. This represents a significant upward revision of $265.6 billion, or 48.6%, compared to the previous AMFT Shipment: China – Q4 2025 Update, which had forecast a 31.26% growth to $546.5 billion for 2026.

• Against a global consensus that AI will drive pervasive and substantial market expansion, China, as one of the leading AI nations, is accelerating its AI infrastructure investments. The Computing & Data Storage Categories are expected to grow 126%, capturing 62.9% of the overall application market. Globally, the semiconductor market is projected to exceed $1.6 trillion in 2026, with Computing & Data Storage accounting for 60.7% of the total. These figures confirm that China's semiconductor development is moving in parallel with global markets, as the industry transitions decisively into an AI‑centric era.

• In terms of absolute market size, the Wireless Communications Categories are forecast to grow by 68.8%. However, this smartphone‑driven segment is facing steeply rising supply costs and accelerating shipment contractions. Amid persistent supply‑demand imbalances in the memory chip market, memory prices for smartphones continue to climb, prompting OEMs to raise selling prices to protect margins – but at the cost of reduced shipment volumes. As a result, this application category's share of the total market is expected to decline from 30.43% in 2025 to 26.63% in 2026, with further erosion anticipated in 2027.

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Omdia Q2 2026 Data Shows China's Memory Chip Market Share Upward to 262.9%, Reaching $449.6 Billion in 2026

According to Omedia’s latest AMFT – China Region: Semiconductor Application Market Forecast Tool, Q2 2026 report (by chip category), China's memory chip market is projected to hit $449.6 billion, with its market share rising from 29.4% in 2025 to 55.4% in 2026 – and is expected to maintain a majority share going forward. On the global stage, the total memory chip market is forecast to reach $886.4 billion in 2026, accounting for 54.8% of the overall semiconductor market.

• AI‑driven infrastructure development remains the primary engine fueling demand for semiconductor components. Cloud‑based AI training, inference, and the impending surge in edge‑side and device‑side inference are driving substantial increases in memory specifications and capacity requirements, further tightening the supply‑demand balance in the memory market.

• Beyond memory, AI is also propelling growth in other chip categories: logic chips are projected to grow 27.9%, analog ICs 25.4% – with particular strength in high‑performance computing chips and high‑spec power management ICs for servers – and microcontrollers are expected to see 15% growth, largely fueled by new application scenarios driven by edge AI, especially physical AI.

AI Creates Significant Headroom for Improving China's Semiconductor Self‑Sufficiency

2026 is widely regarded as the breakout year for AI inference. Domestic Chinese AI accelerator suppliers are well positioned to deliver comprehensive hardware solutions across all tiers of edge and device‑side applications, leveraging their deep understanding of local use cases. In particular, the growing trend of "chip‑model co‑optimization" is enabling closer collaboration between Chinese AI models and domestic computing platforms, both in product definition and ecosystem development.

The widespread adoption of AI serves as a powerful catalyst for China's existing semiconductor industrial base. With steady capacity expansion in mature process nodes and power devices, Chinese chipmakers are seeing increasing production demand. The infrastructure requirements brought by AI are expected to significantly boost utilization rates for locally manufactured chips, while the gradual release of upstream supply chain capacity will translate into higher order volumes and improved fab utilization.

*This is translated from the original article from Omdia's WeChat Account. To view the original content, please visit: https://mp.weixin.qq.com/s/8nh-XMSRlN-rK5rnWBPIWw