SMT & Inspection | January 04, 2007
Global chip equipment spending stay flat
Gartner says worldwide semiconductor capital equipment spending to be flat in 2007 and rebound wth double-digit growth in 2008.
Worldwide semiconductor capital equipment spending grew 24.9 percent in 2006, but the market will readjust with revenue declining 0.7 percent in 2007, according to Gartner, Inc. The market is projected to return to strong growth in 2008, as worldwide spending will increase 20.8 percent. “In 2006, slowing logic-related demand from integrated device manufacturers (IDMs) and foundries alike was offset by strong commodity memory investments, resulting in healthy growth for the semiconductor capital equipment industry," said Klaus Rinnen, managing vice president for Gartner's semiconductor manufacturing and design research group. “In 2007, a softer macroeconomic sales environment for electronics combined with excess semiconductor inventories and strong 2006 capacity investments will cause a small contraction in equipment demand in 2007, but it will not be a collapse in demand." Gartner forecasts wafer fab equipment to turn in a nearly flat year in 2007 with 0.6 percent growth, down from 26.3 percent growth in 2006 (see Table 1). Gartner is projecting a market contraction for packaging and assembly equipment (PAE) of 5.7 percent in 2007, and a contraction of 5 percent for automated test equipment (ATE). Table 1 Worldwide Semiconductor Capital and Equipment Spending Forecasts (Millions of Dollars) The wafer fab equipment market continued to sail along, thanks to strong spending in memory, although first signs of the slowdown hit in the fourth quarter as push-outs by several key memory manufacturers occurred. At this time, these push-outs appear to be only temporary as the market supply and demand adjusts. Segments associated with leading-edge technology should be hot because equipment to facilitate 65- and 45-nm technology will be in demand. The order picture for packaging PAE certainly peaked around the middle of 2006 as semiconductor assembly and test services (SATS) providers took a more cautious look at market conditions. This wait-and-see attitude is the dominant market view as 2006 comes to a close. Gartner analysts believe that end-user device demand will soften as we enter 2007. An expected softening of demand has pushed the PAE quarterly growth picture to the negative side. After a soft decline in 2007, we expect vibrant PAE market growth of 26 percent in 2008.
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