Gold Tug-of-War: AI Boom vs Cost Pressures in Electronics

Gold's role in technology is often overlooked, but it remains an essential material for electronics and other industries. In 2025, industrial demand for gold used in electronics, dentistry, and other areas totalled 323t, virtually unchanged from 2024.

The growth of AI has had a significant impact on the electronics sector, with many analysts wondering how this might affect gold demand. However, the relationship between gold and electronics is complex, and several factors are at play. On one hand, cost pressures and technical advances have led to a reduction in gold usage, while on the other hand, the AI boom has spurred recent demand for gold.

The use of gold in electronics dates back almost a century, but it really took off during the 1960s and 70s as semiconductors became mainstream. Engineers recognized that gold's unique combination of properties made it an ideal material for high-reliability applications. Today, gold is found in high-end chips that power devices such as cell phones, laptops, and vehicles.

The AI boom has led to increased demand for gold, but this is being offset by cost pressures and technical advances. The use of gold in co-packaged optics (CPO) could potentially support future gold demand, as it requires the metal's durability and excellent electrical performance. However, manufacturers will always try to minimize or eliminate the use of high-cost materials, making it difficult for gold to replace other materials entirely.

Beyond electronics, gold is used in various industries such as aerospace, chemical catalysis, and optical applications. It also has a significant impact on healthcare technologies, particularly in diagnostic tests that rely on tiny particles of gold to provide rapid and accurate diagnosis of diseases.