[News] IC Designers Reportedly Eye 5% to Double-Digit Price Hikes in Late 2026–Early 2027 as Foundry Costs Rise

Rising foundry and backend manufacturing costs are putting further pressure on chip designers, raising the prospect of another round of semiconductor price hikes. According to Economic Daily News, power management IC, driver IC, and microcontroller (MCU) suppliers are reportedly considering a second round of price hikes between the end of 2026 and early 2027 to reflect higher costs, with increases potentially ranging from 5% to double-digit percentages.

The prospect of further cost increases is already affecting purchasing behavior further down the supply chain. IC design companies say some of their customers have begun pulling in orders, driven partly by concerns over the conflict in the Middle East and AI demand continuing to crowd out capacity, according to another Economic Daily News report. With costs expected to rise further, some customers are stepping up purchases to protect margins ahead of potential increases.

Those concerns come as foundry prices, the largest component of IC production costs, are expected to climb further. Economic Daily News notes that TSMC is reportedly set to raise prices from January 2027, with mature-node prices expected to increase by around 3% to 10%.

Notably, IC design companies stress that the recent pickup in orders does not reflect a broad-based recovery in market demand. As customers pull in orders, suppliers are comparing order volumes with last year to gauge the extent of potential over-ordering and adjusting shipment plans accordingly, seeking to avoid a repeat of excessive orders or elevated customer inventories that could later weigh on the IC design market, Economic Daily News adds.

Alternative Foundries May Offer Little Cost Relief

Economic Daily News notes that some customers require IC suppliers to use non-China supply chains, limiting the foundry options available to chip designers. Shifting production from Taiwanese foundries to U.S.-based alternatives may not necessarily be cost-effective, leaving chip designers with few cheaper options as manufacturing costs rise. This could give them more room to pass higher costs on to customers.

Even for customers willing to use Chinese foundries, major China-based foundries are also reportedly considering price increases, although the size of the hikes has yet to be determined, as noted by Economic Daily News. SMIC had already moved to raise prices earlier this year. Reuters reported in August that the foundry negotiated higher prices for some of its most sought-after capacity, with the increases set to apply to wafers processed in the third quarter. Its average wafer selling price rose 5.7% QoQ in 2Q26, while capacity utilization reached 93.7%.

TSMC Leading-Edge Prices Reportedly Set to Rise Further

Pricing pressure is also continuing at leading-edge nodes. According to Digital Daily, TSMC has reportedly decided to raise prices for its 2nm wafers by an additional 6% to 8% in the first quarter of 2027, citing rising manufacturing costs and surging electricity expenses. The move comes after price increases of 10% to as much as 20% have already been reflected for individual customers.

Read more

• [News] 12-inch Wafer Price Hikes Loom for 2027 as AI Demand Tightens Supply, with LTAs Reportedly Up 15–40%+
• [News] TSMC Reportedly Advises IC Designers of Mature-Node Price Hikes Effective Jan. 2027; Single-Digit Increase Expected

(Photo credit: TSMC)