Semiconductors used in AI data centers could reach as much as $1.2 trillion by 2029, representing more than 95% of leading AI server rack content value, according to new data from the Semiconductor Industry Association (SIA) and market research firm Deloitte.
This is a nearly tenfold increase over the last four years and surpasses total global semiconductor sales from 2025 by more than 50%, across all end uses, the companies said.
Additionally, semiconductors also account for more than 50% of total capital expenditure required for building and operating an AI data center, SIA said.
The data found that AI requires the full range of semiconductor technologies including memory, logic, analog and foundational chips. In total, a single AI server rack contains over 4,500 packaged chips, SIA said.
“The future of AI will be determined by the full array of semiconductor technologies that power it,” said John Neuffer, SIA president and CEO. “To ensure global AI adoption is built on American chips, we need government policies that promote access to global markets and strengthen U.S. competitiveness. We stand ready to work with policymakers to ensure American semiconductor technology remains the engine of AI innovation for many years to come.”
Source: SIA
Government policy support
To meet global demand for AI, SIA and Deloitte said the government and industry will invest more than $4 trillion in new data center infrastructure through 2028, $2.8 trillion of this will be spent on semiconductors.
The government policies that will help continue this growth in semiconductors for AI data centers will include the Trump Administration’s Pax Silica Initiative and its AI Exports Program.
Pax Silica is the flagship AI and supply chain security initiative that forms a coalition built for AI that includes representatives from silicon, compute, minerals, energy and more. The U.S. government allocated $250 million in foreign assistance to fund support for critical mineral extraction, processing, critical infrastructure and manufacturing.
The AI Exports Program is an initiative to partner with industry leaders for full-stack AI export packages —hardware, software, models, applications and standards — to allies globally. This might also include AI-optimized computer hardware, data center storage, cybersecurity measures and sector-specific applications.
For more information on the data, check out SIA and Deloitte’s “Powering AI: The Semiconductor Ecosystem at the Foundation of Data Centers report.
