Semiconductor Etch Equipment Market Trends Reflect Industry Modernization

Semiconductor Etch Equipment Market Size and Forecast 2025 to 2034

The global semiconductor etch equipment market size accounted for USD 28.15 billion in 2024 and is predicted to increase from USD 30.16 billion in 2025 to approximately USD 56.1 billion by 2034, expanding at a CAGR of 7.14% from 2025 to 2034. The market is growing due to rising demand for advanced chips driven by AI, 5G, and automotive electronics.

Semiconductor Etch Equipment Market Key Takeaways

• In terms of revenue, the global semiconductor etch equipment market was valued at USD 28.15 billion in 2024.
• It is projected to reach USD 56.1 billion by 2034.
• The market is expected to grow at a CAGR of 7.14% from 2025 to 2034.
• Asia Pacific dominated the semiconductor etch equipment market with the largest share of 70% in 2024.
• North America is expected to grow at the fastest CAGR between 2025 and 2034.
• By etching type, the dry etching segment held the biggest market share of 85% in 2024.
• By etching type, the wet etching segment is observed to grow at the fastest CAGR during the forecast period.
• By process type, the dielectric etch segment captured the largest market share of 50% in 2024.
• By process type, the conductor etch segment is expected to grow at the fastest CAGR during the forecast period.
• By wafer size compatibility, the 300 mm segment contributed the highest market share of 75% in 2024.
• By wafer size compatibility, the ≥450 mm segment is emerging as the fastest growing during the forecast period.
• By equipment type, the single wafer etch systems segment accounted for significant market share of 60% in 2024.
• By technology node, the ≤7 nm segment held the biggest share of 40% in 2024
• By technology node, the ≤7 nm segment is observed to grow at the fastest CAGR during the forecast period.
• By end-use device type, the logic IC segment generated the major market share of 35% in 2024.
• By end-use device type, the memory IC (NAND) segment is emerging as the fastest growing.
• By application, the FEOL segment dominated with the biggest market share of 60% in 2024.
• By application, the packaging etch segment is observed to grow at the fastest CAGR during the forecast period.
• By end user, the foundries segment held the remarkable market share of 55% in 2024.
• By end user, the OSATs segment is observed to grow at the fastest CAGR during the forecast period.

How is AI transforming the semiconductor etch equipment industry?

Artificial Intelligence is transforming the semiconductor etch equipment industry by enabling higher precision, improved yield, and enhanced process control. Predictive analytics and real-time monitoring, enabled by AI systems, help identify irregularities early in the etching process, thereby minimizing flaws and equipment downtime. To adjust etching parameters and ensure consistency at the nanoscale level, machine learning algorithms analyze vast datasets from previous runs.

Additionally, AI-powered automation enables adaptive process adjustments, optimizing cycle times and minimizing human intervention. This is particularly crucial as chip architectures become increasingly complex with the rise of advanced nodes used in AI, 5G, and automotive applications. By enhancing efficiency, accuracy, and equipment utilization, AI is enabling equipment manufacturers to meet the increasing demand for high-performance, cost-effective semiconductor solutions.

Asia Pacific Semiconductor Etch Equipment Market Size and Growth 2025 to 2034

Asia Pacific semiconductor etch equipment market size was exhibited at USD 19.71 billion in 2024 and is projected to be worth around USD 39.55 billion by 2034, growing at a CAGR of 7.21% from 2025 to 2034.

What made Asia Pacific the dominant region in the market?

Asia Pacific dominated the semiconductor etch equipment market by capturing the largest revenue share in 2024. This is mainly due to the region's strong manufacturing base and the presence of leading semiconductor foundries. This area benefits from significant capital investment in advanced chip fabrication, a strong supply chain, and extensive R&D activities. Its dominance is further enhanced by ongoing innovation in next-generation nodes and robust demand for consumer electronics and AI chips. Strong fabrication ecosystems and government support further solidify Asia Pacific's leading position in the semiconductor etching equipment market.

What makes North America the fastest-growing market for semiconductor etch equipment?

North America is expected to experience the fastest growth in the coming years, driven by increasing investments in technology sovereignty programs and domestic semiconductor manufacturing. The implementation of incentive programs and strong R&D capabilities drives the development of advanced etch systems. Businesses in these regions are expanding their production capacities to support AI, HPC, and automotive applications, driving demand for equipment. The focus on localizing semiconductor supply chains ensures the region's continued growth.

Market Overview

The semiconductor etch equipment market refers to the global industry centred on the manufacturing and sale of machinery and tools used to selectively remove layers of material (metal, oxide, polysilicon, etc.) from a semiconductor wafer during the fabrication of integrated circuits (ICs). Etching can be dry (plasma-based) or wet (chemical-based) and is critical for defining patterns in IC production nodes below 10nm.

Semiconductor Etch Equipment Market Growth Factors

• Miniaturization of semiconductor nodes: Shrinking nodes like 7nm, 5nm, and 3nm are increasing the need for highly accurate etching systems that can handle FinFET and GAA architectures with atomic-level precision.
• Rising automotive semiconductor demand: Electric vehicles and ADAS systems are pushing the need for multilayer, safety-critical chips that require advanced etching for reliability and compliance.
• Adoption of EUV lithography: EUV processes demand etch tools that support tighter pattern tolerances and new photoresist materials, increasing complexity and equipment requirements.
• Growth in 3D ICs and advanced packaging: Technologies such as chiplets, TSVs, and fan-out packaging require highly selective etching during wafer thinning, interposer patterning, and RDL formation.
• Increasing AI and HPC chip production: High-performance computing and AI workloads are driving foundries to invest in advanced etch tools to support logic, GPU, and memory production at advanced nodes.

Market Scope

Market Dynamics

Drivers

Rising Demand for Advanced Semiconductor Nodes

As transistor sizes continue to shrink to 7nm, 5nm, and even 3nm nodes, etching procedures have become more intricate and crucial. Advanced nodes, particularly those in FinFET and gate-all-around (GAA) structures, require precise and selective etching to prevent damage to neighboring layers. High-precision plasma etch systems are now in greater demand as a result of this. Manufacturers are investing in new machinery that can be controlled at the atomic level to meet performance standards. The demand for sophisticated etch tools will only increase as more fabs transition to sub-5 nm manufacturing.

Increased Chip Production for Automotive Electronics

Increased chip production for automotive electronics drives the growth of the semiconductor etch equipment market. Nowadays, semiconductors form the core of contemporary automobiles, enabling everything from connectivity and infotainment to ADAS and battery management systems. Strong, highly reliable chips that require precise manufacturing procedures are becoming increasingly in demand as the automotive industry transitions towards electric vehicles and autonomous systems. The fabrication of automotive chips is more complex due to the strict safety and environmental regulations they must adhere to. For functional safety compliance, precise layering and defect minimization are ensured by advanced etch equipment. The demand for etch tools is increasing in tandem with automakers' increased semiconductor sourcing.

Restraints 

High Capital Investment and Operating Cost

Equipment used for semiconductor etching is extremely expensive. Large capital expenditures are required to set up or upgrade fabs with sophisticated etching systems, which can be prohibitive for small and mid-sized chipmakers. Operating costs are further increased by maintenance, skilled labor, and energy costs. In areas where cost is a concern, these financial burdens may limit market penetration and postpone procurement decisions. Widespread adoption is hindered by the fact that only large foundries and IDMs can afford frequent upgrades.

Environmental and Regulatory Challenges 

Environmental and safety issues are raised by the use of hazardous gases and chemicals, such as fluorocarbons, in etching procedures, particularly in dry plasma-based etching. Regulations about energy use, emissions, and hazardous waste in semiconductor manufacturing are becoming more stringent across all regions. Businesses are currently facing pressure to adopt more environmentally friendly practices, which require higher expenditures for eco-friendly materials, recycling equipment, and exhaust treatment. Adherence to these changing standards may make the deployment of etch equipment more expensive and complicated, particularly in new regions.

Opportunities

Growth in 3D ICs, Advanced Packaging, and Heterogeneous Integration

Advanced packaging methods, such as chiplets and fan-out wafer-level packaging, as well as 3D integrated circuits, are gaining popularity as chipmakers look beyond Moore's Law. These methods require accurate etching at multiple points, including interconnect patterning, TSV formation, and wafer thinning. Manufacturers of etching equipment can create customized instruments to meet these packaging needs. Custom etch solutions are made possible by the intricacy of intertie communication and vertical integration. For manufacturers of equipment, this market presents a high-margin opportunity, as companies like TSMC and Intel are embracing heterogeneous integration.

Adoption of EUV Lithography Driving New Etch Requirements

Today, cutting-edge chip manufacturing (5nm and below) uses Extreme ultraviolet (EUV) lithography, which presents new etching challenges. EUV requires etch tools to function with even greater precision and selectivity, as it introduces new photoresist chemistries and tighter pattern tolerances. This change provides suppliers of etching equipment with an opportunity to collaborate on solutions with lithography developments. Leading production lines will give an early mover advantage to vendors who can provide tools tailored for EUV-produced patterns.

Etching Type Insights

Why did the dry etching segment dominate the semiconductor etch equipment market in 2024?

The dry etching segment dominated the market with the largest share in 2024 due to its high accuracy, anisotropic capabilities, and compatibility with sub-10 nm nodes, all of which are critical for modern chip designs. Dry etching is a preferred choice for advanced logic and memory applications due to its ability to etch intricate patterns without damaging adjacent layers. Dry etching is now essential as chipmakers increasingly rely on FinFET and 3D NAND architectures. It is a reliable workhorse across fabs due to its integration with reactive ion and plasma-based systems, supporting high throughput and reproducibility.

The wet etching segment is expected to grow at a rapid pace in the upcoming period due to its cost-effectiveness, high material selectivity, and strong adoption in packaging, MEMS, and power semiconductor applications. Wet etching is crucial for backside processing and wafer thinning as the need for advanced packaging solutions increases. Moreover, it is favored in certain specialized applications where consistent etching over large wafer areas is required. Its precision is improving thanks to new wet etch chemistries and sophisticated control systems, enabling it to compete in markets where dry etch tools are used.

• On 13 May 2025, DuPont unveiled its latest semiconductor wet etching innovations at the Surface Preparation & Cleaning Conference, focusing on improved selectivity and precision for advanced memory chips. (Source: https://www.dupont.com)

Process Type Insights

How does the dielectric etch segment dominate the market in 2024?

The dielectric etch segment led the semiconductor etch equipment market in 2024 due to its crucial role in defining insulation layers in advanced semiconductor devices. As device complexity increases, the need to precisely etch dielectric materials, such as silicon dioxide and low-k dielectrics, between metal lines becomes increasingly essential. The growing use of multi-patterning and high-aspect-ratio structures has further amplified the need for advanced dielectric etch processes. This segment's growth also driven by a strong demand for dielectric etch in both logic and memory manufacturing.

The conductor etch segment is likely to grow rapidly during the forecast period due to the decrease in interconnect pitches and the emergence of intricate metal gate stacks. Accurate conductor patterning becomes increasingly important as sophisticated logic devices and memory integrated circuits move to smaller nodes. The need for etching instruments capable of handling cutting-edge materials like cobalt, ruthenium, and tungsten has increased due to the growing use of EUV lithography and GAA (gate all around) FETs. The market expansion for conductor etch systems is being driven by this trend, which is also encouraging innovation in these systems.

Wafer Size Compatibility Insights

What made 300 mm wafers the dominant segment in the market?

The 300mm wafers segment dominated the semiconductor etch equipment market in 2024 due to their improved cost per die economics and extensive use in high-volume semiconductor manufacturing. The majority of sophisticated fabs are designed to process 300mm wafers, especially for the creation of logic DRAM and 3D NAND. Its dominance is further reinforced by the presence of suitable tools, established infrastructure, and developed process recipes. Additionally, this size offers the best yield-throughput ratio for mass-market chip manufacturing.

The ≥450 mm segment is expected to expand at the highest CAGR over the forecast period. ≥450 mm wafers are gaining traction as chipmakers explore next-generation wafer sizes to increase output and reduce per-unit manufacturing costs. Wafer etch systems dominated the market in 2024 and are expected to sustain this growth during the forecast period. Major players are investing in 450 mm and R&D, even though it is still in its early stages of development to meet long-term capacity goals. Interest is growing, particularly in AI HPC and hyperscale applications, because of the potential for economies of scale to be driven by larger wafers. The segment is growing as toolmakers start to prototype etch systems that work with this size.

Equipment Type Insights

Why did the single-wafer etch systems segment dominate the market in 2024?

The single wafer etch systems segment dominated the market in 2024 because, compared to batch systems, they offer greater precision, improved process control, and reduced wafer-to-wafer variability. With advanced nodes where even the smallest deviations can affect performance, these tools are particularly well-suited. Additionally, single-wafer tools enable quicker process transitions and personalized recipe tuning. Logic and memory fabs that require high yields and low require high yields and low contamination are perfect for them because of their flexibility and cleanliness.

On 6 November 2024, NexGen Wafer Systems launched SERENO, a high-throughput single-wafer wet etch and clean platform with integrated metrology optimized for multi-wafer sizes and advanced packaging. (Source: https://www.nasdaq.com)

The segment continues to sustain its position in the coming years due to the increasing adoption of advanced packaging and heterogeneous integration, which require fine-tuned, layer-specific etching. As chipmakers migrate to smaller geometries and 3D architectures, single-wafer systems offer the repeatability and accuracy needed for complex multilayer builds. The rising focus on high-mix, low-volume production in leading-edge fabs also boosts their uptake.

Technology Node Insights

How does the ≤7 nm segment dominate the market in 2024?

The  ≤7 nm segment dominated the semiconductor etch equipment market in 2024 and is expected to maintain its growth trajectory throughout the forecast period. This is because ≤7 nm nodes are essential for sophisticated chip production, including flagship smartphones, SoCs, high-end GPUs, and AI processors. FinFET and GAA structures, in particular, require highly precise etching steps. The increasing use of EUV lithography and the need for ultra-thin gate dielectrics are driving a greater demand for high-performance etch systems suitable for processes with dimensions of ≤7 nm. This segment's dominance is further solidified by major foundries and IDMs that have already scaled up 5nm and are now progressing to 3nm.

End Use Device Type Insights

Why did the logic ICs segment dominate the semiconductor etch equipment market in 2024?

The logic ICs segment dominated the market with a major share in 2024 because of its fundamental role in CPUs, GPUs, and SoCs that power everything from data centres to smartphones. Advanced lithography and accurate etching at sophisticated nodes are necessary for these devices, which has increased the need for expensive etch systems. Premium etch tool suppliers benefit from the frequent process changes and increased tool flexibility required by the rapid evolution of logic chip designs. Logic chips remain the most lucrative and technically challenging market for etching, despite the growth of AI and edge computing.

The memory IC segment is expected to expand rapidly in the coming years, as demand for data storage and transfer speeds intensifies. Memory ICs, especially DRAM and 3D NAND, require high aspect ratio etching and deep trench processing tasks that depend on specialized etch tools. Innovations in 3D stacking and vertical scaling in memory architecture are driving higher equipment demand. As cloud computing, mobile storage, and generative AI expand, the demand for memory-focused etching continues to surge.

Application Insights

What made Front End of Line (FEOL) the dominant segment in the market in 2024?

The FEOL segment dominated the market with the largest share in 2024. This is because it encompasses the most sensitive and critical processes in semiconductor fabrication, including transistor patterning and gate stack formation. Etch accuracy during this stage has a direct effect on the dependability, power efficiency, and performance of the device. As nodes shrink, FEOL becomes more etch-intensive, driving manufacturers to invest heavily in advanced etch tools, thus solidifying its dominance in equipment demand.

The packaging etch segment is expected to grow at a rapid pace during the forecast period, driven by the increasing adoption of advanced packaging technologies such as chiplets, FOWLP, and 2.5D/3D ICs. These technologies require specialized etching for redistribution layers (RDLs), vias, and interposers. As performance gains increasingly take priority in packaging over node scaling, the demand for etch tools compatible with this application is rising significantly. The transition from monolithic to modular chip design necessitates the use of packaging etch.

End-User / Fabrication Facility Type Insights

Why did the foundries segment dominate the semiconductor etch equipment market in 2024?

The foundries segment dominated the market while holding the largest revenue share in 2024, as they are the primary users of cutting-edge process equipment, serving diverse clients in AI, mobile, automotive, and HPC. These foundries are technologically advanced and continuously update their equipment to meet evolving client needs. The ability of foundries like TSMC, GlobalFoundries, and Samsung Foundry to process memory and logic at scale ensures a constant demand for etch systems. Their capital-intensive nature supports the widespread adoption of advanced tools.

The OSATs segment is expected to experience rapid growth over the projection period due to the increasing demand for advanced packaging as more businesses switch to modular chip designs. OSATs increasingly use semiconductor etch equipment to deliver high-density packages that require precise etching. The need for sophisticated yet affordable etch tools is being driven by their growing integration into the semiconductor supply chain, particularly for consumer electronics and automotive chips.

Semiconductor Etch Equipment Market Companies

• Applied Materials, Inc.
• Lam Research Corporation
• Tokyo Electron Limited (TEL)
• Hitachi High-Tech Corporation
• Plasma-Therm
• Oxford Instruments
• NAURA Technology Group Co., Ltd.
• ULVAC, Inc.
• SPTS Technologies (a KLA company)
• ACM Research, Inc.
• SAMCO Inc.
• AMEC (Advanced Micro-Fabrication Equipment Inc.)
• Veeco Instruments Inc.
• Rudolph Technologies (Onto Innovation)
• Trion Technology, Inc.
• CORIAL (Now part of Plasma-Therm)
• Panasonic Corporation (Semiconductor Manufacturing)
• Shibaura Mechatronics Corp.
• Mattson Technology Inc. (part of E-Town Capital)
• RION Technology

Recent Developments

• On 19 February 2025, Lam Research launched its Akara conductor etch tool, featuring breakthrough plasma control via Direct Drive technology delivering atomic-scale precision for 3D chip structures and enabling faster plasma responses to support GAA transistors and advanced DRAM/NAND devices. 
  (Source: https://www.prnewswire.com)
• In April 2025, Tokyo Electron expanded its equipment lineup by integrating AI-based control systems for real-time plasma monitoring, reducing pattern collapse, and improving yield.(Source: https://ts2.tech)

Segments Covered in the Report

By Etching Type

• Dry Etching
  • Plasma Etching
  • Reactive Ion Etching (RIE)
  • Deep Reactive Ion Etching (DRIE)
  • Inductively Coupled Plasma (ICP) Etching
• Wet Etching
  • Isotropic Wet Etching
  • Anisotropic Wet Etching

By Process Type

• Conductor Etch
  • Metal Etch
  • Polysilicon Etch
• Dielectric Etch
  • Oxide Etch
  • Nitride Etch
• Silicon Etch

By Wafer Size Compatibility

• ≤150 mm
• 200 mm
• 300 mm
• ≥450 mm

By Equipment Type

• Batch Etch Systems
• Single-Wafer Etch Systems

By Technology Node

• ≥65 nm
• 45–65 nm
• 28–45 nm
• 10–28 nm
• ≤7 nm

By End-Use Device Type

• Logic IC
• Memory IC
  • DRAM
  • NAND
• Analog & Mixed Signal
• Power Devices
• MEMS
• CMOS Image Sensors

By Application

• Front-End-of-Line (FEOL)
• Back-End-of-Line (BEOL)
• Packaging Etch (e.g., TSV, RDL)

By End-User / Fabrication Facility Type

• IDMs (Integrated Device Manufacturers)
• Foundries
• OSATs (Outsourced Semiconductor Assembly and Test)
• Research & Academia / R&D Labs

By Region

• Asia-Pacific
• North America
• Europe
• Rest of the World (RoW)