Chip equipment makers see global sales falling

PETALING JAYA: Geopolitical tensions have prompted the US-based Semiconductor Equipment Manufacturing Industry (SEMI) to reduce its forecast for global sales by over 18% this year to US$52.7bil.

Global sales of semiconductor manufacturing equipment by original equipment manufacturers were projected to drop to US$52.7bil this year from last year’s historic high of US$64.5bil, according the US-based trade body yesterday.

“The current forecast reflects recent downward adjustments in capital expenditures and rising market uncertainty due in part to geopolitical tensions,” it said in its Mid-Year Total Equipment Forecast posted on its website.

SEMI is the global industry association representing the electronics manufacturing and design supply chain.

The forecast showed that the main segment of the equipment makers - wafer processing equipment sales - falling by 19.1% in 2019 to US$42.2bil.

The other front-end segment, consisting of fab facilities equipment, wafer manufacturing, and mask/reticle equipment, is expected to slide 4.2% to US$2.6bil this year.

The assembly and packaging equipment segment is on track to decline 22.6% to US$3.1bil in 2019, while semiconductor test equipment is forecast to decrease 16.4% to US$4.7bil this year.

SEMI forecast Taiwan will dethrone South Korea as the largest equipment market and lead the world with 21.1% growth this year, followed by North America with an 8.4% uptick.

However, SEMI was more optimistic for 2020 and it expects a 11.6% jump to US$58.8bil.

It sees the equipment market is expected to recover on the strength of memory spending and new projects in China.

Equipment sales in Japan will surge 46.4% percent to US$9bil. China, Korea, and Taiwan are forecast to remain the top three markets next year, with China rising to the top for the first time.

South Korea is forecast to become the second largest market at US$11.7bil, while Taiwan is expected to reach US$11.5bil in equipment sales. More upside is likely if the macro economy improves and trade tensions subside in 2020.

Fintech , Semiconductor Equipment