June 1, 2026 /SemiMedia/ — Vanguard International Semiconductor (VIS) expects semiconductor market conditions to improve further in the second half of 2026, supported by growing AI-related demand and continued strength across multiple end markets.

VIS Chairman Fang Leuh said after the company’s annual shareholder meeting that industry conditions in the second half are likely to be stronger than in the first half as AI adoption continues to expand and customer demand gradually improves.

The company said its manufacturing capacity is currently fully utilized, with demand continuing to exceed available supply. Despite tight capacity conditions, customers remain actively placing orders to secure future production allocations and maintain supply continuity.

Industry observers noted that mature-node foundries are benefiting from the gradual recovery of semiconductor demand following an extended inventory correction cycle that affected many sectors over the past two years.

Commenting on wafer foundry pricing, Fang said VIS maintains close cooperation with customers and will continue evaluating pricing based on market conditions.

He noted that operating costs, including utilities, raw materials and labor, have continued rising, while ongoing investments in manufacturing capacity and technology upgrades are also increasing cost pressures across the industry.

According to Fang, semiconductor supply chains have become more receptive to price adjustments under the current environment. VIS will continue monitoring market dynamics, competitive conditions and customer requirements while remaining open to discussions regarding pricing adjustments.

Market analysts said pricing for certain mature-node and specialty process technologies could remain firm as AI-driven demand improves overall semiconductor consumption while supply expansion remains relatively limited.

Although advanced nodes continue to dominate AI processor production, demand growth is also supporting mature-node products such as power management ICs, display driver ICs, microcontrollers, analog devices and automotive semiconductors, contributing to higher utilization rates across the mature foundry sector.