The automotive semiconductor cycle is turning in the second half of 2026. Major overseas chipmakers have reported a rebound, inventories across the supply chain have normalized, Tier 1 orders are recovering, and several product lines are already in a second round of price increases. Deutsche Bank and Bernstein say the industry has entered a structural uptrend, but this recovery is set to be uneven rather than broad-based. Infineon, NXP and other leaders have seen inventory days fall from above 200 to 120-140 days in the first quarter of 2026, while supplier inventory-to-sales ratios have returned to safer levels. Lead times for mainstream automotive power devices have stretched beyond 30 weeks, and SiC modules are taking more than 40 weeks in some cases. That tightening has already pushed prices up 10%-25% across multiple categories. The split is clearest in SiC, high-voltage IGBT, high-end MCU, and in-vehicle storage. 800V platforms are driving demand for higher-value semiconductors, while AI-related demand is absorbing mature 8-inch capacity. For automakers, the key issue is no longer shortage across the board, but which chips are tight, which are normalized, and which are still under pressure.

Bernstein has raised its global wafer fab equipment, or WFE, spending forecasts for 2026 through 2028 and says the current upcycle in chip equipment spending still has room to run. The firm now expects WFE to reach $148 billion in 2026, $204 billion in 2027, and $259 billion in 2028, up from prior estimates of $141 billion, $175 billion, and $198 billion. That implies cumulative growth of 75% over two years. The upgrade spans most applications and regions, but Bernstein said the larger contribution comes from memory outside China and from foundry and logic spending in China. DRAM and NAND are expected to post the fastest growth, outpacing logic and foundry. For 2027, Bernstein forecasts DRAM WFE at $69 billion, NAND at $20 billion, and logic/foundry at $104 billion, each above its earlier projections. The report also points to stronger-than-expected resilience in China. Bernstein forecasts China WFE demand at $57 billion in 2026, $57.3 billion in 2027, and $101 billion in 2028, with a sharp step-up tied to broad capacity expansion across memory, advanced logic, and mature logic. It also said recent pullbacks in semiconductor equipment stocks have created more attractive entry points, while warning that the views, ratings, and price targets cited are those of Bernstein analysts and do not constitute investment advice.

A recovery is taking shape across the analog semiconductor market, with ON Semiconductor, Texas Instruments, STMicroelectronics and NXP Semiconductors all reporting year-over-year and sequential revenue growth, while third-quarter guidance also pointed to further sequential gains. The rebound is no longer tied to a single end market. Industrial demand moved first, data center demand followed, and automotive improved visibly in the second quarter. Inventory metrics shifted at the same time: STMicroelectronics said its book-to-bill ratio was close to 2, NXP’s channel inventory fell back to 11 weeks, and Texas Instruments reported rising backlog with lead times extending by several weeks from a level below 13 weeks. Management commentary across the group suggested the analog market had moved from a long destocking phase toward normalization, with new orders beginning to flow again. The report also shows the upcycle is uneven. Some categories, including automotive analog, power management, AI server power chains, optical module analog front ends and certain sensors, are tightening. General-purpose parts, consumer electronics and parts of the power and discrete segment still face pricing pressure. AI is becoming a more important growth driver as data center power conversion, thermal management, optical connectivity and industrial or automotive applications increase the content value of analog chips. Even so, forecasts cited in the report indicate analog is improving rather than leading the broader semiconductor boom, which is still being driven much more sharply by memory.

Changxin Technology, or CXMT, is set to debut on Shanghai’s STAR Market at an IPO price of RMB 8.66, implying a post-listing market capitalization of RMB 579.188 billion before any greenshoe exercise. The listing is the largest IPO on the STAR Market to date, but the main discussion has already shifted far beyond the offer price. Northeast Securities analyst Li Jiu valued the company from three separate angles — global market-share parity, earnings-based PE, and capacity-based comparison — and said fair equity value converges at roughly RMB 3.2 trillion to RMB 5.7 trillion after stripping out minority interests. On the same day, Nomura initiated coverage with a Buy rating and a RMB 116 target price, implying a 1,239% upside from the IPO price and a market capitalization of about RMB 7.76 trillion. The gap between the two views comes down to two variables: how large CXMT’s long-term DRAM market share can become, and how much growth premium investors should assign to a domestic Chinese DRAM producer. The company now sells DDR4/5 and LPDDR4X/5/5X products, supplies Alibaba, Tencent, ByteDance and mainstream smartphone supply chains, and held a 7.67% global DRAM share in the fourth quarter of 2025, according to Omdia.

ChangXin Memory Technologies, described in the report as China’s leading DRAM storage IDM player, is set to officially list on Shanghai’s STAR Market on July 27 with an issuance valuation of about RMB 580 billion. The company plans to raise RMB 29.5 billion, with roughly RMB 22.066 billion earmarked for equipment procurement and installation. The report also laid out a broad map of companies tied to the supply chain. In equipment, NAURA has already shipped etch and thin-film deposition tools in volume, while Advanced Micro-Fabrication Equipment Inc. China is still moving through verification and volume procurement for etch and thin-film tools. ACM Research’s CMP equipment has entered the core supply chain, and testing equipment makers Precision Measurement Electronics and Jztest are also cited as beneficiaries. On the materials side, the report named Yahc, Guanggang Gases, Jinhong Gas, Red Avenue New Materials, Jingrui Electronic Materials and Debang Technology. It also mentioned packaging and module-related names including Huatian Technology, Longsys and Delingli, as well as distributor Sunlord Electronics. According to the report, several listed firms hold indirect stakes through industry funds, with Shangfeng Cement holding about 0.1517% before the offering.

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