RHB Forecasts Global Semiconductor Recovery and AI Surge to Propel Malaysia's Tech Sector in 2026

RHB Investment Bank Research anticipates sustained revenue and earnings growth for Malaysia's technology sector throughout FY26.

This positive outlook is fueled by a global semiconductor recovery and robust AI-related demand.

Semiconductor Segments Set for Expansion

Engineering support and automated test equipment manufacturers stand to gain from escalating semiconductor volumes and increasing complexity.

Outsourced semiconductor assembly and test providers are poised for a rebound, albeit with performance variations tied to market exposure.

In contrast, the electronics manufacturing services segment grapples with persistent challenges from customer cost reductions and suboptimal factory utilization.

Historical Growth Amid Headwinds

The sector posted 3.1% year-on-year revenue growth in Q4 2025, defying foreign exchange pressures.

Year-to-date revenue climbed 8.4%, underscoring a broadening recovery across local tech firms.

Future Catalysts and Lingering Risks

Future momentum draws from replacement cycles, automotive resurgence, AI-driven upgrades, and heightened server demand.

Company managements express optimism with rising order loadings and fresh program wins heading into FY26.

Nevertheless, forex fluctuations, geopolitical tensions, and softening consumer electronics could pressure margins and earnings.