Bank of America analyst sees $3.2T semiconductor market by decade’s end

Bank of America just told Wall Street that AI spending fears are overblown, raising its semiconductor total addressable market forecast to $3.2 trillion by 2030. The previous estimate sat at $2.7 trillion, which itself was already an upgrade from an earlier $2 trillion projection.

To put the trajectory in perspective: the semiconductor industry took roughly 50 years to reach $1 trillion in annual sales. BofA now expects the market to nearly double from its current valuation of approximately $1.7 trillion in roughly four years.

The numbers behind the upgrade

The bank’s research note revised its compound annual growth rate forecast for the 2026 to 2030 window to 18%, up from a prior estimate of 14%. BofA also raised its wafer fabrication equipment spending forecast for 2026 to $156 billion, up from $144 billion. That figure is projected to climb toward $360 billion by the end of the decade.

The primary catalysts behind the revision are memory chips and data-center components, both of which are tightly coupled to the buildout of AI infrastructure. BofA’s note specifically dismisses concerns about a potential AI spending slowdown, pointing to ongoing customer orders and capacity commitments from data center and AI enterprises.

Who stands to benefit

The bank highlighted several semiconductor names as particularly resilient in this environment. Nvidia, AMD, Marvell, Analog Devices, onsemi, Micron, Lam Research, Applied Materials, and Intel all received mention as companies positioned for upside.

The equipment makers, Lam Research and Applied Materials, supply the tools that foundries and integrated device manufacturers use to fabricate chips. When WFE spending projections jump from $144 billion to $156 billion in a single revision, these companies see a direct pipeline boost.

Micron’s inclusion reflects the memory chip angle. AI workloads are extraordinarily memory-intensive, and high-bandwidth memory has become one of the tightest supply chains in the semiconductor ecosystem.

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