Chip Equipment Billings Drop
Global billings for chipmaking equipment during the first quarter this year dropped as the semiconductor industry hunkers down in the trade war between the U.S. and China.
SEMI, the global industry association representing the electronics manufacturing and design supply chain, reported that worldwide semiconductor manufacturing equipment billings for the first quarter of 2019 dropped 8 percent from the previous quarter and 19 percent from the same quarter in 2018 to US$13.8 billion.
The data are gathered jointly with the Semiconductor Equipment Association of Japan (SEAJ) from over 80 global equipment companies that provide data on a monthly basis. The quarterly billings data by region in billions of U.S. dollars, quarter-over-quarter growth and year-over-year rates by region are as follows:
1Q2019 |
4Q2018 |
1Q2018 |
1Q19/4Q18 |
1Q19/1Q18 |
|
Taiwan |
3.81 |
2.81 |
2.27 |
36% |
68% |
Korea |
2.89 |
3.13 |
6.26 |
-8% |
-54% |
China |
2.36 |
2.69 |
2.64 |
-13% |
-11% |
North America |
1.67 |
1.94 |
1.14 |
-14% |
47% |
Japan |
1.55 |
2.65 |
2.13 |
-41% |
-27% |
Europe |
0.84 |
0.91 |
1.28 |
-8% |
-34% |
Rest of World |
0.67 |
0.82 |
1.27 |
-18% |
-47% |
Total |
13.79 |
14.96 |
16.99 |
-8% |
-19% |
Source: SEMI (www.semi.org) and SEAJ, June 2019
Equipment billings peaked in the first quarter of 2018 at $16.99 billion and have been declining each quarter since that time, according to SEMI.
Investments for memory peaked in 2017, moderated in 2018 and have been cut in 2019, said Lara Chamness, a senior market analyst at SEMI. Equipment investments in China in 2018 offset some of memory's softness last year resulting in a strong year for the total equipment market.
Taiwan boosted its first quarter investment while all other regions covered by SEMI turned negative. The region, which is the home of TSMC and a host of other semiconductor companies topped the global list at $3.81 billion in billings for the first quarter.
After peaking in 2016 at $12.2 billion, the equipment market in Taiwan contracted for two consecutive years. TSMC's strong investment in 7nm+ capacity and preparation for the rollout of 5nm is a key part of the growth this year.
SEMI expects that investments in China and in memory will rebound next year, making 2020 a recovery year.
Global chip sales will drop by 7.2% from last year as the semiconductor market works through a supply glut and ducks crossfire from the U.S.-China trade war, market research firm International Data Corporation (IDC) said last month.
Sales this year are set to reach $440 billion compared with $474 billion in 2018, according to IDC.
For 2019, the logic segment is likely to grow 1% to $319 billion while DRAM and NAND are expected to decline in 2019 and 2020, IDC said.
