Overview
China’s semiconductor equipment imports increased by 9% year‑over‑year in July, marking a clear acceleration from the 4% growth recorded in June. The July rebound follows a 16% YoY decline in the first quarter and a modest 1% overall decline in the second quarter of 2026.
Category‑specific performance
Lithography equipment imports rose 7% YoY in July, improving on the 3% increase seen in June. Chemical vapor deposition (CVD) equipment imports surged 15% YoY, reversing a 16% decline recorded in the previous month. Etching equipment imports fell 6% YoY, an improvement from a 24% YoY drop in June. Assembly and back‑end equipment imports jumped 35% YoY, following a 43% rise in June, while wire bonder imports experienced a sharp 61% YoY increase.
Regional driver and market context
The recovery in imports is largely driven by demand in the Shanghai region, aligning with commentary from ASML’s second‑quarter earnings that logic‑chip spending is the primary catalyst for equipment demand, whereas memory‑chip spending remains subdued.
Outlook and forecasts
Barclays projects that China’s wafer‑fabrication equipment market will grow 10% in 2026 and 15% in 2027. When accounting for export controls and ongoing localisation efforts, the addressable market for the bank’s coverage is expected to expand by 3% in 2026 and 7% in 2027. Barclays also anticipates that memory‑chip spending in China will accelerate in the second half of the year as capacity expansions pick up pace.