Bank of America has lifted its growth projections for the US semiconductor sector, citing a reshaping capital expenditure cycle driven by stronger memory chip demand and heightened server investment. The revised forecast now estimates the industry's total addressable market (TAM) will reach $3.2 trillion by 2030, up from a prior projection of $2.7 trillion.

The bank suggests the US semiconductor market could nearly double from its current estimated size of $1.7 trillion over the next four years, underpinned by sustained customer orders in data center and artificial intelligence applications along with increasing capacity commitments. This outlook translates to a compound annual growth rate (CAGR) of 18% for the 2026-2030 period, exceeding the bank's earlier estimate of 14%.

Memory chips and data center components are expected to account for the majority of this anticipated growth. Concurrently, Bank of America has raised its forecasts for the semiconductor equipment industry, bumping its 2026 wafer fabrication equipment (WFE) spending projection from $144 billion to $156 billion, and lifting its 2027 estimate from $190 billion to $210 billion. The bank further anticipates that related spending could reach $360 billion by 2030.

The outlook for dynamic random access memory (DRAM) appears notably strong, with the bank projecting DRAM equipment spending to hit $61 billion this year and climb to $85 billion by 2027. Beyond Bank of America's optimistic stance, independent industry projections point to a similar trajectory. SEMI forecasts WFE sales to expand by 23.1% to $143.9 billion in 2026, attributing the growth to increased investment in advanced memory chips—particularly high-bandwidth memory (HBM)-related DRAM—as well as heightened spending in advanced logic chips.

Recent memory market data reinforces the case for a stronger spending outlook. TrendForce reports that global DRAM industry revenue surged 59.5% quarter-over-quarter in the second quarter, reaching nearly $154.73 billion. This robust growth is fueled by AI server demand driving shipments of high-bandwidth and high-capacity storage products, while supply expansion lags behind demand. TrendForce also projects that DRAM and NAND Flash combined could represent up to 68% of major cloud service providers' capital expenditures by 2027, a substantial increase from the 47% expected in 2026.