The Semiconductor Industry Association (SIA), in partnership with Deloitte, released a report titled “Powering AI: The Semiconductor Ecosystem at the Foundation of Data Centers.” The report states that the full range of semiconductor technologies accounts for more than 95% of a leading AI server rack’s content value and more than 50% of total capital expenditures required for building and operating an AI data center.
A virtual teardown of a state-of-the-art AI data server rack shows it contains over 4,500 packaged chips. These include advanced logic chips (AI accelerators, ASICs, FPGAs, CPUs, DPUs, and networking chips), memory (high-bandwidth memory (HBM), DRAM, SRAM, and NAND flash), and analog and foundational chips (power chips, transceivers, controllers, and sensors).
AI data centers require large amounts of compute, storage, memory bandwidth, power distribution, and networking capabilities provided by the full stack of chip technologies.
The report projects that annual revenue from semiconductors deployed in AI data centers could reach over $1.2 trillion by 2028, representing a nearly tenfold increase over four years and surpassing total global semiconductor sales from 2025 by more than 50%.
Government and industry are expected to invest over $4 trillion in new data center infrastructure through 2028, of which up to $2.8 trillion will be spent on semiconductors.
“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.”
The report analyzes future market trends in the AI data center landscape and notes that rapid changes in AI will pose challenges and opportunities for the semiconductor industry amid intensifying global competition.
