Artificial intelligence has woven itself into daily routines, powering tasks like email composition, travel planning, photo editing, video production, in-depth research, and even application coding. Yet, while AI simplifies life for many, it has sparked a critical shortage of memory and storage components vital for laptops and smartphones. This scarcity is pushing original equipment manufacturers to hike device prices. Meanwhile, the AI industry's market value is exploding, backed by enormous investments in data center construction.

The meteoric rise of AI is compelling chip producers to shift semiconductor output toward this booming field. Taiwan Semiconductor Manufacturing Company (TSMC) now projects exponential growth for the global chip market by decade's end, driven primarily by AI momentum.

AI and High-Performance Computing Set to Claim Bulk of Global Chip Market

Drawing from a TSMC presentation at a technology symposium, Reuters indicates the company foresees the worldwide semiconductor market surging to $1.5 trillion (about Rs. 1,43,89,471 crore) by 2030 - rivaling the GDP of a mid-sized nation. TSMC further estimates that AI and high-performance computing will seize roughly 55 percent of this expansive market.

Smartphones, by comparison, are slated to hold a modest 20 percent slice of the 2030 global semiconductor market. Semiconductors also play a key role in vehicles, fueling digital interfaces in cars and motorcycles, with TSMC eyeing a 10 percent share for automotive applications.

TSMC is ramping up manufacturing capacity at an accelerated rate into 2026, including nine phases of wafer fabrication and advanced packaging setups this year. The company plans to scale production of 2nm chips and forthcoming A16 systems-on-chips, which could post a 70 percent compound annual growth rate from 2026 through 2028.

The firm's Chip-on-Wafer-on-Substrate packaging, integral to Nvidia's AI processors, is poised for over 80 percent annual growth by 2027, benchmarked against 2022 levels. TSMC also anticipates an 11-fold jump in AI accelerator wafer demand by the end of this year from 2022 baselines.

Such figures signal robust expansion ahead for AI and semiconductors. A United Nations Trade and Development (UNCTAD) analysis pegged the global AI market at $189 billion in 2023, forecasting growth to $4.8 trillion by 2033.