China's purchases of chipmaking equipment are set to decline this year after three years of growth, as the industry grapples with overcapacity and faces greater constraints from U.S. sanctions, a consultancy said on Wednesday.

However in 2025, China's spending is anticipated to decline 6% year-over-year to $38B and its share of global purchases will decrease to 20% in the first decline since 2021, Boris Metodiev, a senior semiconductor manufacturing analyst at TechInsights, said in an online seminar, according to the report.

China's semiconductor equipment purchases are expected to decline in 2025 after three years of growth, according to Canadian research firm TechInsights. The decline comes amid industry overcapacity and intensified US export controls.