According to Bank of America, driven by a surge in demand related to artificial intelligence (AI), global semiconductor sales are expected to reach approximately $1 trillion by 2027. This forecast marks a significant upward revision from the bank's previous estimate of $860 billion. In a report to clients, analysts noted: “We believe the growth prospects for memory chips (including high bandwidth memory (HBM), general-purpose DRAM, and NAND flash), as well as components related to data centers and AI, will significantly improve, while performance in the consumer electronics and automotive sectors will slightly offset overall growth.” The analysts further added: “We still believe that the structural resilience of current AI infrastructure construction will be stronger than in any previous major industry cycle, thus we remain optimistic regarding AI-related capital expenditures.” Specifically, Bank of America forecasts that industry sales will reach $745 billion, $870 billion, and $971 billion in 2025, 2026, and 2027, respectively, marking an upward revision of about 3% to 6% from previous expectations. Excluding the memory chip sector, sales for 2025-2027 are projected to reach $538 billion, $621 billion, and $706 billion, respectively. The bank also reiterated its five preferred stocks in the sector: Nvidia (NVDA.US), Broadcom (AVGO.US), AMD (AMD.US), Lam Research (LRCX.US), and KLA Corp (KLAC.US), indicating that these companies are best positioned to benefit from the “strong outlook for data center and storage spending.” In addition to semiconductor sales, Bank of America analysts updated their projections for semiconductor equipment spending, expecting it to reach $118 billion, $128 billion, and $138 billion from 2025 to 2027. Although the growth rates for 2026 and 2027 may slow, this aligns with the bank's view that chip equipment spending will achieve “sustainable” growth in the coming years. The analysts concluded: “In the long term, we believe the capital intensity of the semiconductor industry may stabilize between 14% and 17%, exceeding the historical average level of 13% by 100 to 400 basis points. The core reason for this change is the significant increase in complexity in semiconductor manufacturing processes. Compared to previous forecasts, spending in the data center/AI sector is expected to rise, while spending in consumer electronics and automotive sectors may decline.” The analysts finally emphasized: “Our new industry model indicates that memory chips and the data center/AI sectors will achieve faster growth, while the recovery in consumer electronics, personal computers, smartphones, and automotive end markets will slightly offset overall growth. Notably, we currently anticipate that the year-over-year growth rates for data center components such as servers (excluding chips) and wired infrastructure will reach 55% and 28%, respectively, in 2025; as the industry enters a broader cyclical recovery in 2026-2027, year-over-year growth rates across all end markets will further increase.”