According to Omdia, global semiconductor sales in the second quarter of 2026 rose 31.4% quarter-on-quarter to more than $425 billion, setting a new quarterly record. The first half alone reached $752 billion, and the third quarter is expected to exceed $500 billion. However, reading this record as evidence that chips simply sold 30% more across the board would misread the market's actual condition. At the center of the rapid expansion are supply constraints originating in AI-oriented high-bandwidth memory (HBM), rising memory prices, and a shift in product mix toward higher-priced items. Meanwhile, the non-memory market also far exceeded its normal seasonal pattern. The 2026 semiconductor market is not simply recovering demand—it has entered a phase in which AI infrastructure and existing products are competing for limited supply capacity.
Breaking Down $425 Billion into Volume, Price, and Product Mix
The 31.4% figure represents revenue—it does not mean the number of chips, wafer starts, or memory capacity shipped increased by the same proportion. Semiconductor revenue is broadly driven by three factors: shipment volume, average selling price, and product mix. If demand shifts toward more expensive products and prices rise for the same products, revenue can grow substantially even when volume growth is modest.
According to Omdia's figures, memory ICs alone accounted for more than half of the total market in the second quarter—meaning at least $212.5 billion came from memory. This is not a precise memory revenue figure but merely a lower bound derived from the disclosure that memory accounted for "more than half." Still, combined with the fact that DRAM, NAND, and NOR each set new quarterly revenue records, it is clear that overall market growth was heavily skewed toward memory.
This skew becomes even clearer when compared with prior-year market size. According to figures published by the Semiconductor Industry Association (SIA) based on World Semiconductor Trade Statistics (WSTS), full-year 2025 revenue totaled $791.7 billion. Omdia's first-half 2026 figure of $752 billion approaches that annual total in just six months. However, WSTS monthly figures are presented as three-month moving averages, and their scope and methodology differ from Omdia's quarterly tracker. The two figures serve as reference points for gauging the market's momentum, but should not be treated as a directly comparable growth rate.
DRAM Revenue Up 59.5%, But Bit Shipments Rose Only Modestly
The gap between price and volume is most clearly visible in DRAM. According to TrendForce, second-quarter DRAM industry revenue rose 59.5% quarter-on-quarter, while bit shipments increased only modestly. The firm attributes the growth mainly to price increases driven by supply shortages and a shift in product mix toward higher-priced server products. A roughly 60% revenue increase does not mean 60% more DRAM reached the market.
On the supply side, the top three players—Samsung Electronics, SK hynix, and Micron Technology—accounted for 87.6% of second-quarter DRAM revenue. In this oligopolistic market, each company has prioritized capacity for AI server-oriented high-bandwidth memory and server DRAM, shrinking commodity inventories to historically low levels and forcing buyers to accept high prices for limited supply. TrendForce also forecasts that third-quarter commodity DRAM contract prices will rise 13–18% quarter-on-quarter.
The same pattern appears in Samsung's results. In the second quarter of 2026, revenue at the company's Device Solutions division, which handles semiconductors, rose 56% year-on-year, and memory revenue hit a record high. The company cites server demand, rising average selling prices (ASPs), and growth in high-value-added products such as high-bandwidth memory as factors. While the exact price contribution cannot be isolated from these figures, this is consistent with an explanation in which the record was driven not by an across-the-board surge in shipment volume, but by selective allocation of supply and pricing.
Even Excluding Memory, an AI Investment Wave Remains
Still, memory prices alone do not fully explain the record. Omdia also confirmed growth far above a normal second quarter in non-memory segments, including microprocessors (MPUs).
Non-memory semiconductor revenue rose more than 10% quarter-on-quarter, far exceeding the typical second-quarter seasonal average of just over 3%, while microprocessors grew 16%—sixteen times the seasonal average of 1%.
These figures, too, represent revenue rather than volume, and Omdia does not disclose the respective contributions of price, shipment volume, and product mix. Even so, they offer supporting evidence that investment in AI data centers is not confined to GPUs and high-bandwidth memory, but is spreading to peripheral components such as host CPUs, networking, and storage. According to Dell'Oro Group, revenue from key data-center components rose 182% year-on-year in the second quarter, while the average selling price per bit more than doubled. Although Dell'Oro's figures are limited to data-center applications, they indicate that rising performance and rising unit prices are advancing together across AI systems as a whole.
That said, non-memory growth of over 10% should not be read as an across-the-board boom either. Components closer to data centers tend to benefit more, while in consumer devices, higher component costs are cooling demand. The 2026 semiconductor market is expanding in revenue terms from segments closest to AI infrastructure, while leaving a persistent temperature gap across different end uses.
A Forecast That Moved 63.4 Points in Six Months
Omdia's forecast for year-on-year growth in 2026 semiconductor revenue was raised from 30.7% in January to 62.7% in April, and then to 94.1% in July—an upward revision of 63.4 percentage points over six months.
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Still, the pace of revision itself is meaningful. As of January, continued demand for AI servers was the main growth driver cited, but afterward, views strengthened that shortages of high-bandwidth memory, advanced packaging, and leading-edge process capacity would persist beyond 2027, and supply constraints and price increases spread to commodity DRAM and NAND as well. It appears that forecasters not only revised demand estimates upward but also rebuilt their models to reflect a structure in which redirecting supply capacity toward higher-margin products inflates market value even at the same shipment volume.
The fact that the forecast changed sharply three times in a short period does not make future figures more certain—rather, it underscores the scale of uncertainty. If supply constraints persist, revenue will remain elevated, but if rising prices erode end demand, the divergence between value and volume will only widen further.
Record Sales for Suppliers, Headwinds for Device Makers
Even as memory prices rise, the effect on earnings runs in opposite directions for component suppliers and finished-product makers. While Samsung's Device Solutions division saw revenue grow 56% year-on-year, revenue at its Device eXperience division, which handles smartphones and televisions, fell 9%. Samsung explains that rising component costs, including memory, put pressure on the profitability of its mobile business. Pricing power in the semiconductor division translates into higher costs for the company's own finished-product division.
The same pattern holds across the market as a whole. According to Omdia's final figures, global smartphone shipments fell 6% year-on-year in the second quarter of 2026. In an earlier analysis, the firm estimated that memory costs for smartphones had risen to four to five times year-earlier levels, pushing memory's share of device bill-of-materials costs above 60%, and above 30% even for premium models. While this ratio varies by device tier and design, it is high enough to force manufacturers into price increases, reduced storage capacities, and narrower model lineups.
Of course, memory prices alone cannot explain the entire shipment decline; replacement cycles, regional economic conditions, and inventory adjustments also play a role. But the fact that record-setting semiconductor revenue and declining smartphone shipments occurred in the same quarter shows that a boom upstream does not necessarily mean rising demand downstream. Paying high prices for scarce components can expand the upstream market even as downstream sales volume contracts.
Beyond the $500 Billion Headline: What to Watch Next
Omdia forecasts that global semiconductor revenue will exceed $500 billion in the third quarter, pushing the January-through-September 2026 cumulative total above $1.25 trillion. If achieved, the record would grow even larger. But the $500 billion revenue figure alone cannot tell us whether the market has shifted from price increases driven by supply shortages to sustained growth in genuine end demand.
At least four indicators are worth watching. First, whether DRAM and NAND bit shipments catch up with prices. Second, whether non-memory growth continues to exceed seasonal averages and spreads beyond AI data centers. Third, whether manufacturer capital spending rises even as commodity DRAM contract price growth slows. Fourth, whether smartphone and PC shipments recover by absorbing higher component costs.
Attention must also be paid to the consistency of published figures. In its June announcement covering the first quarter, Omdia described growth of 27% quarter-on-quarter, but in its September announcement covering the second quarter, it described the prior quarter's previous record as a 29.2% increase. While the figures may have been revised, publicly available materials alone do not confirm the reason for the change or the revised absolute value. When comparing records, preliminary and revised figures should not be conflated.
The current $425 billion figure is not evidence that semiconductors have become abundant. Rather, it is evidence that supply capacity has skewed toward AI, and that high prices have been established over limited memory supply. The next turning point will arrive not at the moment revenue rises further, but at the moment when bit shipments and device shipments begin to increase even as price growth eases.