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(Bloomberg) -- Tokyo Electron Ltd. is planning record research and development outlays this fiscal year and gave an upbeat revenue forecast on a surging demand for AI-enabling infrastructure.

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The supplier of semiconductor manufacturing equipment to Samsung Electronics Co., Taiwan Semiconductor Manufacturing Co. and Intel Corp. said it expects appetite for artificial intelligence chips to help lift sales by 20% to ¥2.2 trillion ($14.1 billion) in the year to March, narrowly beating the average of analyst estimates.

Demand for high-end semiconductors is surging. TSMC said April sales jumped 60% on appetite for AI chips, while memory maker SK Hynix Inc. said that its capacity for such chips is almost fully-booked through next year. That, in turn, is spurring investment throughout the sector, with both Samsung and SK Hynix ratcheting up capacity.

Tokyo Electron is setting aside ¥250 billion for research and development this year. Demand is recovering for equipment used at the front end of logic and memory chipmaking, said Tokyo Electron President Toshiki Kawai. Production of such front-end machines, which form circuits onto wafers, is expected to clock double-digit percentage growth next year, helped especially by AI-linked server demand, he said.

Rising global demand for front-end gear should lower Tokyo Electron’s reliance on China to less than 40%, Kawai said. China made up 44% of the company’s total revenues in the year ended March.

For the March quarter, Tokyo Electron reported operating income fell 5% to ¥145.2 billion on a 2% decline in sales, in line with estimates.

The weak yen has no impact on the company, as Tokyo Electron’s equipment sales are denominated in yen, said Hiroshi Kawamoto, the company’s general manager of finance.

--With assistance from Vlad Savov.

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