Bank of America analysts predict a multi-year boom for the semiconductor industry, fueled by the surging demand for artificial intelligence (AI).
The bank said in a note that observations from Computex, a tech trade show, highlight a global push towards AI across various sectors.
“We see the semiconductor industry is set for multi-year growth, with the tech titans being all in for AI at Computex,” states BofA.
They highlight the increasing presence of AI in everything from data centers to edge computing, PCs, and smartphones. BofA believes this will necessitate larger semiconductor dies to handle the growing volume of data and processing power required for AI applications.
The rapid pace of innovation underscores this demand. “The relentless compute demand rise can be reflected in AMD (NASDAQ:AMD)’s and NVIDIA (NASDAQ:NVDA)’s fast product development cadence of one year,” adds BofA.
Furthermore, BofA cites ARM’s projection of a massive increase in AI-ready devices, expecting over 100 billion ARM units capable of running AI by the end of 2025. In addition, the bank emphasizes energy efficiency as a key driver, pushing the industry towards advanced nodes.
The BofA notes also points to the growing focus on AI-powered PCs. “We have seen overwhelming focus on AI computing power (TOPS) in semi chip announcements at Computex,” Bofa states.
Several major PC manufacturers showcased AI-enabled PCs, suggesting a significant market shift. BofA likens this trend to the rise of smartphones, noting that “the PC industry is witnessing the ‘smartphone momentum’ (as Qualcomm said).”
