Worldwide semiconductor capital equipment spending is expected to total US$35.2 billion in 2012, down 19.2% from the US$43.5 billion estimated for 2011, according to Gartner. Excess electronics inventory and poor demand as a result of the slowing macro economy are to blame for the declining spending.
"The slowdown appears to be across the board. While it appears the foundries will continue their capacity race at 28nm, spending on 45nm to 90nm technologies is slowing, and some equipment from those technology nodes is being used for 28nm production to help increase capacity utilization," said Klaus Rinnen, managing vice president at Gartner. "Due to weaker-than-expected growth in the production units of media tablets, NAND spending has softened slightly, as well."
Gartner expects the slowdown to last for the remainder of 2011 and into the first half of 2012. By mid-2012 Gartner expects the supply and demand to be more in balance, so DRAM and foundry will need to begin to increase spending to meet an increase in demand as the PC market rebounds and consumers begin spending once the economy stabilizes a bit. The next growth year is expected to be 2013, when capital spending will increase by 18.4%, Gartner said.
Worldwide wafer fab equipment (WFE) revenues started slowing in the second quarter of 2011, and the decline will accelerate in the second half of 2011 with the added pressure of slowing device sales and excess inventory liquidation, according to Gartner. WFE revenues are forecast to grow 9.4% in 2011, but decrease 19.6% in 2012.
Worldwide packaging and assembly equipment (PAE) revenues are projected to slip 1.4% in 2011, and drop by another 17.5% in 2012, Gartner said. Orders for PAE have softened more aggressively than previously expected as supply comes in line with expectations.
For back-end process providers' capex purchases, 3D packaging and copper wire bonding for lower-cost solutions will still be the focus, but at a reduced pace, Gartner indicated. Most major tool segments will see slightly negative sales in 2011, but advanced tooling will once again be stronger than the general market this year. For 2012, traditional tooling segments will see a sizable decline in sales, while advanced packaging segments are expected to fall less than traditional when compared with 2011, Gartner said.
For 2011, the automated test equipment (ATE) market is expected to remain essentially flat with revenue growth at 0.4%, according to Gartner. The market has been driven by the continued demand of system-on-chip and the advanced radio frequency segments of the market.
Memory ATE will likely pull back in 2011 as DRAM capex softens, Gartner indicated. However, NAND testing platforms are expected to be stronger than the general memory test market this year. For 2012, analysts expect a significant decline in tester sales, though memory systems should hold up reasonably well compared with most cycles as DRAM capex returns.