SEMI: “Seasonal softening” now controls chip tool demand

November 19, 2010 – Good news: September numbers for semiconductor equipment demand were a little bit better than originally thought. Bad news: October numbers are worse. More bad news: It’s now pretty clear that we’re on the downslope of the peak in chip tool demand.

Inside SEMI’s October statistics:

  • Bookings were $1.65B, the industry’s first three-month sequential decline since early 2009. Orders are now close to May levels. Billings were $1.61B, barely flat (0.7%) from September; technically that’s an 18th consecutive month of rising, but it’s also fourth straight months of ≤4% sales growth, and nine out of 10 in the single digits.
  • Both orders and sales remain well above the same period a year ago, but falling noticeably: now ~111% and 134%, instead of the nearly 200% in August. The further we pull away from the downturn, of course, the closer those Y/Y comparisons will come to normalcy — and eventually we’ll be comparing them on the upside, too. Still, the bookings are above the average figure from 2006-2007, noted SEMI president/CEO Stanley Myers, in a statement.
  • Perhaps the most glaring indicator of slowing demand, the book-to-bill: is officially below the parity mark at 0.98, the first time that’s happened since July 2009 — meaning fewer orders ($98 worth) were received for every $100 billed. The B:B spent the past 15 months above the 1.0 parity mark, many of them in the "teens" and "twenties" range (1.13-1.23). Generally speaking, sales trail orders by six months or more (litho tools closer to a year, some say), so look for this downward tumble in bookings to eventually be reflected in the sales column.
  • With September numbers in, we can calculate prelim. 3Q10 totals: $5.27B in bookings and $4.63B in billings, growth of 12% and 13% respectively — but well below the 25%-33% Q/Q growth in 2Q10.

SEMI’s September numbers were retroactively improved by about 2% (adding roughly $35B) for both billings and bookings; that tweaked up the M/M comparisons to about 3.6% for billings (vs. 1.3%) and -9.1% for bookings (vs. -11%).

While acknowledging "a hesitation in new orders," Myers noted that the waning demand for chipmaking tools merely "reflects seasonal softening and near-term respite in capital spending in some segments of the industry."

Click to Enlarge

In Japan, the downward slide was even more pronounced — October sales of chip tools slipped about -4% to ¥107.56B ($1.29B), and orders slid nearly -6% to ¥120.41B ($1.44B), according to the SEAJ’s monthly statistics. The faster decline in orders, though, kept the book-to-bill ratio above parity at 1.12.


Easily post a comment below using your Linkedin, Twitter, Google or Facebook account. Comments won't automatically be posted to your social media accounts unless you select to share.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>


Ultratech Cambridge NanoTech introduces the Savannah G2 ALD system
01/08/2015Ultratech, Inc., a supplier of ALD systems, as well as lithography, laser-processing and inspection systems used to manufacture semico...
Dynaloy unveils safer cleaners
11/19/2014In response to evolving industry trends and customer preferences for products with better environmental, health, and safety (EHS) profiles, Dynaloy LLC is launching three...
Entegris' VaporSorb filter line protects advanced yield production
10/21/2014Entegris, Inc. today announced a new product for its VaporSorb line of airborne molecular contamination (AMC) filters. ...