Artificial intelligence and advanced semiconductors dominate investment and product cycles. According to Forbes, analysts expect AI-related global expenditures to approach $500 billion by 2026. Thus, the electronics industry must proactively manage elevated demand, which influences capacity allocation and supplier strategies globally. Supply chains are not just evolving; proactive executives are reshaping supply chains with resilient, regional, and ready-to-scale strategies.

Electronics Booming Volumes

The electronics industry is in a transformative state with companies and consumers beginning to take advantage of AI. As AI ramps up while geopolitical tensions escalate, companies are not only scaling up to meet increasing demands, but they also must meet additional volume requirements related to expansion into the United States as companies reshore production of semiconductors and data centers pop up around the country. For example, companies don’t want to be held back based on restrictions from China such as the curtailment of rare-earth shipments required to support electronics production. Thus, they are taking control and reshaping supply chains.

J.P. Morgan estimates that hyperscalers (Meta, Alphabet, Microsoft, Amazon, and Oracle) allocated over $340 billion to capital expenditures in 2025, with much of that linked to servers, GPUs, networking, and data center builds supporting AI workloads. This type of investment is driving significant construction and manufacturing requirements, and it is spurring end-to-end supply chains to pivot to where growth is occurring. For example, since Taiwan Semiconductor Manufacturing Company (TSMC) built its first advanced semiconductor fabrication complex in Arizona, marking one of the most significant foreign investments in U.S. manufacturing history, suppliers are moving there to support production as well. It is designed to become a “gigafab” cluster composed of six wafer fabs, two advanced packaging facilities, and an R&D center, requiring a significant extended supply chain to support the cluster.

Reshaping Supply Chains: Resilient, Regional, Ready-to-Scale

Supply chains are transforming rapidly. China has dominated computer chip production with 60% of the world’s production, and Taiwan produces 90% of advanced computer chips globally. India is trending up as companies diversify, and the United States is a hotbed of activity for AI. The most successful companies are building resilient supply chains that will flex to changing conditions rapidly and without cost increases. Thus, they are investing heavily in predictive processes such as SIOP (Sales Inventory Operations Planning) to reallocate production and gain insights into changing conditions coming down the pike to ensure high levels of customer service are delivered with optimized inventory and cost structures.

In addition, they are refocusing on building resiliency, quality, and capabilities to their supplier base to support sudden increases in backlog successfully and profitably. The entire end-to-end supply chain must be ready to scale yet not bleeding costs unnecessarily. Communications must be instantaneous, visibility across the supply chain available 24/7, and collaborative strategies explored so that the end-to-end supply chain performs similarly to a vertically integrated manufacturer. Manufacturers and supply chain organizations embracing innovative, resilient, and technology-enabled strategies will thrive for decades to come.   

The Bottom Line

As global supply chains are reshaping, the companies that stay ahead of changing conditions and prepare for growth will thrive. This is especially true in the electronics and artificial intelligence space as forward-thinking executives will be ready to scale and utilize AI and advanced technologies to deliver customer value and EBITDA growth. In tomorrow’s supply chain, the interconnected and collaborative innovators will stay resilient, focus on regional supply chains to pivot with evolving business conditions, and prepare to be ready to scale to take advantage of the opportunities that will abound.

For more information, contact the author at landerson@lma-consultinggroup.com or visit www.lma-consultinggroup.com.