The semiconductor foundry market’s revenue rose 17% year over year to $84.8 billion in the third quarter of 2025, driven by strong demand for AI applications on advanced processes across TSMC (TSM) and Chinese foundry vendors, according to Counterpoint Research.
Taiwan Semiconductor Manufacturing Company (TSM) increased its market share to 39% in the third quarter, from 38% previously.
Driven by a ramp-up in 3nm production and strong 4/5nm utilization from AI accelerator customers, including Nvidia (NVDA), AMD (AMD), and Broadcom (AVGO), TSMC (TSM) expanded its market share, posting 41% year-over-year revenue growth.
Non-TSMC foundry players, in contrast, registered a relatively modest growth of 6% YoY in Q3 2025, implying diminishing orders from tariff pull-ins but support from China’s subsidy policy.
On the outlook for the remainder of the year, Senior Analyst Jake Lai said, “As the primary revenue growth drivers reach utilization limits (fully loaded 4/5nm capacity) and CoWoS capacity faces constraints, TSMC, which is set to drive overall foundry market growth in 2025, is unlikely to deliver another significant QoQ revenue growth in Q4.”
“As a result, we expect full-year revenue growth to come in at around 15% for overall foundry 2.0 market.”
The pure-play foundry market is projected to grow 26% YoY and will be the key contributor to overall market expansion, underpinned by sustained shipments of AI GPUs and AI ASICs over the next few quarters, Counterpoint said.
Texas Instruments (NASDAQ:TXN) and Intel (NASDAQ:INTC) had a market share of 6% and 5% respectively. Meanwhile, Infineon’s (OTCQX:IFNNY) stood at 5%, and Samsung’s (OTCPK:SSNLF) at 4%.