Market research firm, Gartner has made further upward revisions to its semiconductor capital equipment spending forecast through 2014. Equipment spending is projected to approach US$36.9 billion in 2010, a 122.1% increase from 2009 spending of US$16.6 billion and a worst to best year scenario in the course of a year, according to Gartner. Spending figure revisions since its June, 2010 updates show the biggest changes occurring in 2013 and 2014.
"The strong semiconductor growth in 2010 has driven semiconductor capital growth to all-time highs," said Klaus Rinnen, managing vice president at Gartner. "Capital expenditure (capex) is above 95 percent due to strong spending by the foundry and logic segments, along with a technology upgrade for the memory manufacturers. In 2011, capex growth is expected to slow to 10 percent, because a slowing economy will negatively impact electronic and semiconductor sales."
Wafer fabrication equipment (WFE) segment is projected to increase 119.9% in 2010, making it one of the strongest sales year ever for the industry sector. Growth is set to increase through 2012 as new fab construction projects start tool installing in 2011 onwards. Gartner expects WFE spending growth of 3.9% in 2011.
Overall utilization rates peaked at 94 percent in the second quarter of 2010 but will quickly drop back to the 90% range as more capacity comes online, and semiconductor production slows and becomes more aligned with end-user demand, Gartner said.
"2010 will likely be the strongest year ever for the semiconductor equipment industry, which will be a nice rebound from the worst year ever," Mr. Rinnen said. "Growth will continue through 2012 as companies move from technology buys to capacity purchases."