SEMI Forecasts Back-to-Back Years of Double-Digit Growth in Chip Equipment Spending

SEMI projects back-to-back years of double-digit growth in worldwide semiconductor equipment sales according to the mid-year edition of the SEMI Capital Equipment Forecast, released here today at the annual SEMICON West exposition. The SEMI outlook calls for the total semiconductor equipment market to grow 20.8 percent in 2014 to reach $38.4 billion and to expand another 10.8 percent in 2015 to exceed $42.6 billion.

Following two years of spending declines, key drivers for equipment spending are investments by foundry and logic fabs for sub 20nm technology, NAND flash makers for leading edge technology (including 3D NAND) and capacity, DRAM technology upgrades for mobile applications, and expansion of advanced packaging capacity for flip chip, wafer bumping, and wafer-level packaging.  All regions of the world are projected to see equipment spending increases in 2015.  Front-end wafer processing equipment is forecast to grow 11.9 percent in 2015 to $34.8 billion, up from $31.1 billion in 2014.  Test equipment and assembly and packaging equipment is forecast to experience growth next year, rising to $3.1 billion (+1.6 percent) and $2.6 billion (+1.2 percent), respectively. The forecast indicates that next year is on track to be the second largest spending year ever, surpassed only by $47.7 billion spent in 2000.

“Mobility and interconnectivity require leading-edge process technologies, both at the fab level and in packaging, and are key factors for growth in equipment spending,” said Denny McGuirk, president and CEO of SEMI. “We expect capital spending to increase throughout the remainder of 2014 and into 2015.”

Growth is forecast in all regions except ROW in 2014 and all regions in 2015. Taiwan is forecast to continue to be the world’s largest spender with $11.6 billion estimated for 2014 and $12.3 billion for 2015. In 2014, North America is second at $7.2 billion, followed by South Korea at $6.9 billion. For 2015, South Korea is in second ($8.0 billion) in spending, followed by North America ($7.3 billion).

In 2014, year-over-year increases are expected to be largest for China (47.3 percent), North America (35.7 percent), South Korea (33.0 percent), and Europe (29.7 percent). Year-over-year percentage increases for 2015 are largest for Europe (47.8 percent increase), ROW (23.5 percent), Japan (15.6 percent), and South Korea (15.0 percent).

The following results are given in terms of market size in billions of U.S. dollars and percentage growth over the prior year:

SEMI 2014 Mid-Year Equipment Forecast by Market Region

By Equipment Type

yr-over-yr

yr-over-yr

 

2013

2014F

% Chg

2015F

%Chg

Wafer Processing

25.36

31.12

22.7%

34.81

11.9%

Test

2.72

3.06

12.5%

3.11

1.6%

Assembly & Packaging

2.32

2.52

8.6%

2.55

1.2%

Other

1.42

1.74

22.5%

2.12

21.8%

Total Equipment

31.82

38.44

20.8%

42.59

10.8%

By Region

yr-over-yr

yr-over-yr

 

2013

2014F

% Chg

2015F

%Chg

Taiwan

10.57

11.57

9.5%

12.27

6.1%

South Korea

5.22

6.94

33.0%

7.98

15.0%

North  America

5.27

7.15

35.7%

7.33

2.5%

China

3.38

4.98

47.3%

5.06

1.6%

Japan

3.38

3.65

8.0%

4.22

15.6%

Europe

1.92

2.49

29.7%

3.68

47.8%

ROW

2.08

1.66

-20.2%

2.05

23.5%

Total

31.82

38.44

20.8%

42.59

10.8%

Source: SEMI, July 2014; Equipment Market Data Subscription (EMDS)