Semiconductor Foundry Market Surges 19% YoY in Q2 2025 Driven by Advanced Process and Packaging

The global semiconductor foundry 2.0 market's Q2 2025 revenue surged 19% YoY, driven by robust AI demand on advanced processes and packaging, and China subsidy program. Pure foundry market leader TSMC's market share rose to 38% in Q2 2025, with a 44% YoY revenue growth due to 3nm ramp up, high utilization rate in 4/5nm from AI GPU, and CoWoS expansion. OSAT sector delivered an 11% YoY revenue growth in Q2 2025, with ASE contributing most of revenue growth.

The global semiconductor foundry 2.0 market experienced a significant 19% year-over-year (YoY) revenue surge in Q2 2025, driven primarily by robust demand for advanced processes and packaging in AI applications, as well as the ongoing China subsidy program. This growth reflects the industry's transition to more sophisticated and energy-efficient technologies.

Pure foundry market leader Taiwan Semiconductor Manufacturing Company (TSMC) played a pivotal role in this growth. TSMC's market share rose to 38% in Q2 2025, with a remarkable 44% YoY revenue growth. This surge was attributed to several key factors:

1. 3nm Ramp-Up: TSMC's successful rollout of 3nm technology has significantly boosted its production capacity and efficiency.
2. High Utilization Rates: The company's high utilization rates in 4/5nm nodes, driven by AI GPU demand, further contributed to its revenue growth.
3. CoWoS Expansion: The expansion of TSMC's Chip on Wafer on Substrate (CoWoS) technology has enabled it to offer more integrated and efficient solutions for AI and high-performance computing (HPC) applications.

In contrast, the OSAT (Original Semiconductor Equipment and Testing) sector delivered an 11% YoY revenue growth in Q2 2025. ASE Technology Holding Co., Ltd. (ASE) was a significant contributor to this growth, leveraging its advanced packaging and testing capabilities to meet the surging demand for AI and HPC applications. ASE's strategic focus on advanced packaging, such as its FOCoS-Bridge and CPO innovations, has positioned it well to capitalize on the AI boom.

These developments highlight the transformative shift in the semiconductor industry, driven by artificial intelligence, high-performance computing, and advanced packaging technologies. The market's strong performance in Q2 2025 underscores the continued demand for high-quality, energy-efficient semiconductor solutions and the strategic importance of foundries like TSMC and OSATs like ASE in meeting this demand.