01. Taiwans Semiconductor Output to Reach 7 Trillion Next Year
On October 29, the Industrial Technology Research Institute (ITRI) estimated that driven by the demand for AI data centers, Taiwan's semiconductor industry output value will reach 6.5 trillion New Taiwan dollars in 2025, a year-on-year increase of 22%; it is expected to exceed 7 trillion in 2026, reaching 7.1 trillion, a year-on-year increase of 10%.
Among them, AI chips and peripheral upgrades drive the high-performance computing chip market. The IC manufacturing industry benefits from the full capacity of 3-nanometer processes and the revenue contribution of 2-nanometer processes. Advanced packaging technology enhances chip performance. In 2025, the output value of Taiwan's semiconductor packaging and testing industry is estimated to reach 710.4 billion New Taiwan dollars, a year-on-year increase of 13.9%; the output value of the IC manufacturing industry is estimated to reach 4.3 trillion New Taiwan dollars, a year-on-year increase of 26.9%. In 2026, the output value of the IC manufacturing industry is expected to exceed 4.8 trillion New Taiwan dollars.
02. Research and Survey Upgrades This Quarters DRAM Increase to 23%
On October 30, TrendForce's survey showed that due to the active expansion of data centers by global cloud service providers, the contract prices of DRAM in the fourth quarter are strengthening. The estimated price increase for general DRAM has been revised upward from 8% to 13% to 18% to 23%, and may continue to be adjusted upward. The market supply and demand are tight, and the atmosphere is optimistic. At the same time, the increasing demand for server DRAM is driving the steady increase in the prices of mainstream products, laying the foundation for market growth in 2026.
Looking forward to 2026, TrendForce estimates that the annual growth rate of server shipments will expand to about 4%, with the most significant growth in models adopting high-performance computing architectures. In addition, the price and profit structure of DDR5 are undergoing a reversal. It is expected that from the first quarter of 2026, the unit profit of DDR5 will exceed that of HBM3e and become the main product supported by suppliers.
03. SK Hynix: AI Server Demand Surges, HBM Shortage Until 2027
On October 30, the Industrial and Commercial Times reported that SK Hynix, a major South Korean memory manufacturer, announced its latest financial results on the 29th, with both revenue and profit in the third quarter reaching record highs driven by the surge in AI demand.
SK Hynix said that strong investment in AI infrastructure has driven a surge in memory demand across the entire product line, and high-value-added products have driven overall profits to new highs. The company has completed negotiations with major customers for HBM supply in 2026 and will begin shipping the next-generation HBM4 in the fourth quarter of 2025 and fully sell it in 2026. At the same time, orders for the full range of DRAM and NAND products in 2026 have been booked out, and the HBM supply shortage is expected to continue until 2027.
In addition, SK Hynix pointed out that global AI giants continue to expand their investments, and the demand for HBM, DDR5, and enterprise SSDs in AI servers has surged.
04. Yageo: AI Orders Strong Despite Off - Season, Outlook Positive for Next Year
On October 31, the Economic Daily reported that Yageo, the world's largest passive component manufacturer, is optimistic that AI applications will continue to be the main driver of growth. Although the fourth quarter is traditionally a slow season, strong demand for AI servers from North American cloud and enterprise customers will lead to a strong performance despite the off - season. The company said that order momentum in the fourth quarter of this year is robust, with the order - to - shipment ratio remaining above 1. Orders for AI applications are better than the overall average, such as the continued strong demand for high - end MLCCs and R - Chips driven by the upgrade of AI servers and data centers.
Looking forward to 2026, Yageo believes that AI, electric vehicles, and communications are the main drivers of passive component demand, with all product lines having the potential to grow. In particular, the layout of high - end passive components and sensor integration will show its benefits.
05. NXP Semiconductors Dispute Impacts Global Supply Chain, Honda Mexico Plant Halts Production
Due to the Dutch government's freeze on the operations of NXP Semiconductors, the global automotive supply chain has been disrupted. Honda's Celaya plant in central Mexico halted production on October 28. The plant mainly produces the Honda HR - V model, with an annual output of about 200,000 vehicles. It is an important base for Honda's exports to the US market. In addition, Honda's Alliston plant in Ontario, Canada, has reduced production by half since October 27 and plans to halt production for a week starting October 30.
Honda said it is working to mitigate the impact of the chip shortage, reassessing the supply chain and considering finding alternative components. Nissan's Chief Performance Officer, Guillaume Cartier, said that Nissan's chip supply inventory can last until early November. The Japan Automobile Manufacturers Association warned that NXP Semiconductors may not be able to ensure chip deliveries, which will seriously affect global automotive production. The European Automobile Manufacturers Association and the Alliance for Automotive Innovation in the US also expressed similar concerns.
06. Microsoft, Google, Meta Expand AI Infrastructure Development and Buy Servers
On October 31, the Economic Daily reported that Microsoft, Google, and Meta—the three major technology giants—are optimistic about AI demand and have revised their capital expenditure forecasts upward. The construction of AI servers will continue into next year, benefiting Taiwanese companies such as Foxconn and Quanta. Alphabet, the parent company of Google, reported its quarterly revenue exceeded $100 billion for the first time, with this year's capital expenditure increased to $91 - $93 billion. Microsoft's capital expenditure for next year is expected to be close to $140 billion. Meta's capital expenditure for next year will be significantly higher than this year. The three major giants' capital expenditure for the last quarter totaled $78 billion, a year-on-year increase of 89%.