COVID-19 drives rise in global fab equipment spending

Rising demand for semiconductors for datacenter infrastructures and server storage along with the buildup of safety stock as U.S.-China trade tensions intensify are also contributing to this year’s growth. Image The bullish trend for overall fab equipment investments comes as the semiconductor industry recovers from a 9% decline in fab spending in 2019 and navigates a roller-coaster 2020 with actual and projected spending drops in the first and third quarters mixed with second- and fourth-quarter increases. Of all chip sectors, memory will see the largest spending increase in 2020, growing USD 3.7 billion, or 16% year-over-year (YoY), to USD 26.4 billion, and tack on an 18% increase to reach USD 31.2 billion in 2021. 3D NAND spending will log the largest percentage surge this year, expanding 39%, and register modest growth of 7% in 2021. DRAM is expected to see 4% growth after a slowdown in the second half of 2020 before jumping 39% next year. Equipment spending forecasts for other semiconductor sectors:

• Foundry, the next largest sector in equipment spending for 2020, is forecast to rise USD 2.5 billion, or 12% YoY, to USD 23.2 billion and edge up 2% to USD 23.5 billion in 2021.
• MPU equipment spending will decline USD 1.2 billion, or 18%, in 2020 and rise 9% to USD 6 billion in 2021.
• Analog spending will grow a robust 48% in 2020 and rise 6% in 2021, an expansion chiefly driven by equipment investments for mixed-signal/power fabs.
• Image sensors equipment spending is expected to rise 4% to USD 3 billion in 2020 and jump 11% to USD 3.4 billion in 2021.