Wafer Fab Equipment (WFE) vendors’ revenues collectively climbed 12% YoY in 2025, reaching $143 billion, as the industry continues to strengthen. The growth was propelled by the massive build-out of AI infrastructure, which surged demand for leading-edge logic, High-Bandwidth Memory (HBM), and advanced packaging tools. The top five WFE manufacturers’ revenues grew 14% YoY in 2025 to $114 billion, driven by double-digit growth in both systems and service revenue according to Counterpoint Research's Wafer Fab Equipment Tracker. 

2026 Revenue Forecast by Equipment Maker (In $ Billion)

Source: Counterpoint Research Wafer Fab Equipment Tracker 

2026 Outlook: The Structural Super Cycle Continues: 

The WFE industry outlook remains structurally strong. We expect a broad-based upcycle in 2026, with revenues projected to grow about 11% YoY. 

• Priority Areas: Growth will be heavily weighted toward the second half of the year, driven by lithography, etch, deposition, process control and advanced packaging. 
• Trailing Edge: Segments like IoT, Auto, and Power sensors are expected to remain flat. 
• Risks: Key risks include physical infrastructure bottlenecks, geopolitical shifts and export controls and the inherent complexity of the 2nm technology transition, and the timing of advanced technology ramps. 

Key performance indicators in 2025 for the top five WFE manufacturers Market Segments: Foundry Strength and Memory Resurgence: 

Foundry-Logic: 

Foundry-Logic revenue grew 8% YoY and remained the industry's primary engine, accounting for 65% of net system sales in 2025. This dominant share was driven by foundry customers significantly increasing their tool investments to support the expansion of advanced chip production, especially for AI accelerators and high-performance computing.  

According to Counterpoint Research’s latest Foundry Market Supply Tracker, the global Foundry 2.0 market’s revenue grew 16% YoY in 2025 to $320 billion driven by the AI boom. WFE revenue is set to see a multi-year uplift from the transition to the “Foundry 2.0” era, which is expected to be marked by strong AI-driven growth in leading-edge fabs like TSMC, steady expansion across regional players such as SMIC, and a structural surge in advanced packaging led by ASE Group. Unlike prior cycles, tied mainly to wafer starts, the next decade will see higher tool intensity per chip due to advanced nodes, chiplet architectures, and packaging complexity (CoWoS, 2.5D/3D). Advanced nodes (5nm and below) shipment share exceeded 50% in 2025, according to Counterpoint Research’s Global Smartphone SoC Shipments Forecast by Vendor by Node.This shifts WFE demand from being purely front-end driven to a more balanced, system-level capex cycle, with packaging and test equipment growing faster alongside traditional lithography, deposition, and etch.  

Memory: 

In the memory segment, revenue jumped 16% YoY for the full year. Although YoY growth in Q4 2025 remained flat, it saw a significant 15% sequential increase from Q3, signaling a robust expansion in NAND and DRAM capacity as suppliers race to meet demand for high-density, AI-optimized memory mainly driven by HBM demand for AI server compute ASIC and HBM base die transition to logic from DRAM process.  

Further, HBM4 marks the first major architectural shift in high-bandwidth memory since inception/HBM2E, transitioning the base die from a traditional DRAM process to a logic process node. HBM4 is likely to hit the market in 2026, providing 2048-bit standard interface with data transfer rates of up to 12.8GT/s. According to Counterpoint Research’s Memory Tracker, HBM4 and HBM4E is likely to constitute 79% of the total HBM shipments in CY 2027. Furthermore, revenue from memory is expected to be strong as customers transition to their next nodes to support latest-generation HBM and DDR5’s adoption across AI infrastructure will drive increased tool shipment. This transition will increase lithography steps per wafer, EUV layers penetration increase, and litho demand per wafer grows faster, subsequently increasing deposition, etch and process control intensity. 

Geographic Shift: China’s Role Normalizes 

China’s share of WFE revenue from the top five manufacturers fell to 32% of net system sales in 2025. This reflects a transition toward a more "normalized" market distribution, as geopolitical export controls and a shift in regional fab spending took effect. However, this decline was increasingly offset by aggressive leading-edge capacity additions in other global hubs. 

Historical Context (2015-2025): A Decade of Structural Shift: 

WFE spending has expanded dramatically over the last 10 years, with revenue from the top five vendors growing at 14% CAGR (2015-2025). This period marks the industry’s most capital-intensive era, characterized by a fundamental shift from capacity-driven capex to technology-driven capex. This growth reflects not only higher wafer capacity additions but also a structural increase in equipment intensity per wafer. 

Between 2015 and 2025, WFE spending grew due to the combination of foundry-driven advanced node scaling, memory transitions such as 3D NAND and HBM and increasing equipment intensity across lithography, deposition, etch, and metrology to address the complexity of advanced node manufacturing. This structural step-up in capital intensity across semiconductor manufacturing, has set the stage for continued growth through the second half of the decade as the industry moves toward 2nm logic, advanced packaging, and increased AI infrastructure capex.  

Top 5 WFE System and services Revenue in $ Billion, YoY (%) Growth 2015 to 2025

Source: Counterpoint Research Wafer Fab Equipment Tracker  

Analyst’s Perspective: The ‘WFE Intensity’ Cycle: 

Senior Analyst Ashwath Rao said, “The traditional model of evenly distributed WFE spending is giving way to a new reality.” Rao notes that the 2nm node ramp with its gate-all-around transistors and backside power delivery, significantly increases process steps relative to prior nodes. AI is driving higher compute intensity, memory bandwidth, and process complexity structurally increasing demand for wafer fab equipment across logic and memory. He further adds that this benefits lithography leader ASML, deposition players Applied Materials and Tokyo Electron, etch leader Lam Research, and process control from KLA Corporation, alongside test solution providers Advantest and Teradyne. Surging HBM demand from Samsung Electronics, SK Hynix, and Micron Technology and its transition toward logic-centric integration further shifts value to foundries like TSMC and advanced packaging players like ASE and Amkor. 

Commenting on the AI driven advanced packaging trends, Senior Analyst William Li, noted, “Given ongoing capacity constraints at TSMC, AI customers are actively securing additional capacity through long-term partnerships with OSAT vendors. As a result, industry capacity for advanced packaging could expand by roughly 80% YoY in 2026.” 

Rao further added, “We are moving into a cycle dominated by leading-edge foundry, DRAM/HBM, and advanced packaging. This is driving a higher WFE intensity cycle that will persist through the second half of the decade.” 

About Counterpoint Research

Counterpoint Research is a global market research firm specializing in products across the technology ecosystem. We advise a diverse range of clients – from smartphone OEMs to chipmakers and channel players to Big Tech – through our offices located in the world's major innovation hubs, manufacturing clusters and commercial centers. Our analyst team, led by seasoned experts, engages with stakeholders across the enterprise – from the C-suite to professionals in strategy, analyst relations (AR), market intelligence (MI), business intelligence (BI), product and marketing – to deliver services spanning market data, industry thought leadership and consulting. Our core areas of coverage include AI, Automotive, Consumer Electronics, Displays, eSIM, IoT, Location Platforms, Macroeconomics, Manufacturing, Networks and Infrastructure, Semiconductors, Smartphones and Wearables. Visit our Insights page to explore our publicly available market data, insights and thought leadership, and to understand our focus, meet our analysts and start a conversation.

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