Institutions: AI component capacity constraints and increased production cuts by major manufacturers are expected to extend the mature process wafer foundry price surge effect to 2027

Golden Ten Data reported on June 30 that, according to the latest survey by TrendForce, with the continued rise in demand for AI Servers, General Purpose Servers, and Edge AI peripherals, wafer foundry capacity allocation has obviously shifted towards AI-related products, accelerating the transformation of the supply and demand structure for mature process technologies. The 8-inch process has benefited from an increase in AI-related Power orders and production cuts by TSMC and Samsung, resulting in a strong increase in capacity utilization and foundry prices. For the 12-inch mature process, TSMC's production reduction is expected to drive a medium- to long-term order reshuffling; in addition, strong Power IC orders of 55nm and above are leading Taiwan-based foundries to reduce production of High Voltage (HV) processes and orders to flow to mainland China’s supply chain. Factors such as the incremental crowding-out effect of new AI-related applications and raw material inflation are creating an atmosphere of price hikes for 12-inch mature process foundry services, with the price surge expected to extend to 2027.