Applied Materials Inc, the world’s biggest semiconductor manufacturing equipment supplier, yesterday said the global semiconductor industry slowed at a faster-than-expected pace this year as a weak macroeconomy weighed on consumers’ willingness to buy new phones.
“As we enter the era of mobile phones, or mobile devices, the industry faces bigger market volatility than in the PC era,” Erix Yu (余定陸), group vice president with Applied Materials and country president of Applied Materials in Taiwan, told a media briefing.
“Consumers can be affected by the macroeconomy in their decision to buy a new phone or not,” Yu said.
“It is becoming increasingly difficult to have clear market visibility,” he added.
However, the company still expects demand for advanced manufacturing equipment to expand capacity, Yu said.
Overall, wafer fab equipment spending this year could be flat, or even trend down compared with last year, as demand from foundry companies weakens due to their improved yield, better inventory management and rising tool reuse, the US-based company said in a statement.
Heavy investments in technology migration to advanced 20-nanometer technology from DRAM companies and NAND flash memory makers might offset weakness from foundry companies this year, the company said.
That would help boost DRAM output by 20 percent to 30 percent annually this year, it added.
Global semiconductor equipment spending is expected to grow 3 percent from last year’s US$37.5 billion to US$38.44 billion this year, with Taiwan spending the most at US$9.56 billion, Semiconductor Equipment and Materials International (SEMI) has forecast.
Applied Materials said in the statement that it is optimistic about foundry companies’ demand for 10-nanometer manufacturing equipment next year.
On Tuesday, Yu told a media briefing for the annual Semicon Taiwan trade show that when foundry companies migrate to 10-nanometer technology from a previous node, they have to increase their equipment spending by 20 percent to 30 percent, which is a lucrative business opportunity for equipment makers.
By 2018, the worldwide capacity of 10-nanometer chips is likely to have more than doubled, he said.
Another growth driver for equipment suppliers comes from the NAND flash memory segment, which is in the process of converting to three dimensional chips from two-dimension chips, Yu said.
The conversion means a 50 percent to 70 percent growth in equipment size, from the existing two dimensional chips, he said.
Currently, 3D chips only account for 15 percent of the global NAND flash memory chips, implying ample room for growth, he added.
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