Thu, Dec 20, 2012 - Page 13 News List

North America’s book-to- bill ratio unhealthy: SEMI

AMERICAN INDUSTRY:The book-to-bill ratio for North American-based semiconductor equipment companies was 0.79 last month, a sign the industry is suffering

By Lisa Wang  /  Staff reporter

The book-to-bill ratio for North America-based semiconductor equipment manufacturers rebounded for the first time in 7 months in November after equipment orders slip to a three-year low, the Semiconductor Equipment and Materials International (SEMI) said yesterday.

The book-to-bill ratio improved to 0.79 last month, from a historical low of 0.75 in October,making the ratio remain below the healthy level of one for a sixth straight month last month amid weak demand,the association said.

A figure of 0.79 means that US$79 worth of orders was received for every US$100 of products billed for the month.

SEMI’s book-to-bill ratio represents a three-month average gauge that shows the ratio of order bookings to actual sales.

A figure higher than one means the need for semiconductor equipment is strong, while below one signals sluggish demand.

Bookings fell 3 percent to US$720.4 million last month from the previous month’s US$742.8 million, the association said.

Last month’s bookings contracted 26.3 percent from US$977.2 million a year earlier.

Billings also dropped 7.5 percent to US$911.9 million last month, compared with US$985.5 million in October, and declined by 22.5 percent from US$1.18 billion in the same period last year, the association’s tallies show.


“Softening in the new semiconductor manufacturing equipment market has persisted through the second half of 2012 and the November equipment billings are at a three-year low,” SEMI president and CEO Denny McGuirk said in a press release.

“Economic headwinds, higher chip inventory levels and soft PC demand are among the factors tempering chip makers’ investment in additional manufacturing capacity,” he said.

Separately, market researcher Gartner Inc yesterday forecast that global wafer fab equipment spending would drop 9.7 percent next year to US$27 billion, from US$29.9 billion this year, because of the weak economy and excess inventory. Spending is expected to grow again in 2014, Gartner said in a report.


The researcher also cut its forecast for global semiconductor companies’ capital spending this year, saying the annual decline in capital spending would deteriorate by 10.7 percent, rather than the by 9.3 percent as it estimated in the third quarter.

Gartner said capital spending would shrink at a faster rate of 14.7 percent next year as semiconductor companies still have to deal with excess inventory amid a weak economy.

Buckling the downtrend, contract chipmakers are expected to increase capital spending by 7.4 percent next year, Gartner said.

The world’s No. 1 contract chipmaker Taiwan Semiconductor Manufacturing Co (台積電) said on Tuesday said it planned to expand capital spending by 8.43 percent to US$9 billion next year from this year’s US$8.3 billion.

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