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© SEMI Analysis | June 12, 2019

Global fab equipment spending to rebound in 2020

Global fab equipment spending will rebound in 2020, growing 20% to USD 58.4 billion after dropping 19% to USD 48.4 billion in 2019, according SEMI.

The 2020 investment increase is a downward revision from the 27% growth forecast earlier this year, and the 19% drop in 2019 spending is deeper than the previously projected decline of 14%. Despite the healthy gains forecast for 2020, fab spending will still fall USD 2 billion short of 2018 investments. Memory sector spending alone is expected to account for a disproportionate share of the 2019 falloff, dropping 45%, but should stage a strong recovery of 45% to USD 28 billion in 2020. The 2020 increase in memory investments would mark year-over-year growth of more than USD 8 billion and drive an overall expansion in fab spending. However, compared to 2017 and 2018 spending levels, 2020 memory investments will be considerably less if the forecast holds. In two countertrends to the memory spending falloff this year, foundry sector investments are projected to increase by 29%, with micro growing by over 40%, fueled by the 10nm MPU launch. It’s important to note that overall micro spending is dwarfed by foundry and memory investments. The World Fab Forecast update tracks investment projects of 440 fabs and lines from 2018 to 2020. A review of the SEMI data by half year shows that memory spending will drop 48% in the first half of 2019, with investments in sector components 3D NAND and DRAM plunging 60% and 40%, respectively. Despite this staggering drop in one sector, overall spending in the first half of 2019 will be partially offset by a 40% increase in investments by leading foundries. With MPU its key driver, micro spending is expected to grow 16% in the first half of the year and another 9% in the second half.
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October 11 2019 3:09 pm V14.5.0-2