China’s semiconductor equipment imports grew 9% year-over-year in July, reversing declines in the first half of 2026, according to trade data analyzed by Barclays. The rebound follows a 1% drop in Q2 and a 16% decline in Q1, with July’s growth accelerating from 4% in June.
The increase was primarily driven by demand for logic chip production, which offset weak memory spending. The Shanghai region accounted for a significant portion of the gains, aligning with commentary from ASML regarding its second-quarter earnings.
Among equipment categories, lithography imports rose 7% year-over-year in July, up from 3% in June, while chemical vapor deposition equipment surged 15% after a 16% decline in June. Assembly and back-end equipment imports climbed 35%, supported by a 61% jump in wire bonder imports. Etching equipment was the sole laggard, falling 6% year-over-year, though an improvement from June’s 24% decline.
Barclays expects China’s memory spending to accelerate in the second half of 2026 as capacity expansions ramp up. The bank projects wafer fabrication equipment growth of 10% for 2026 and 15% for 2027, factoring in export controls and domestic production efforts. It also forecasts a 3% increase in its coverage market in 2026 and 7% in 2027 under these conditions.
