Wafer fab equipment: facing uncertain times all along the semiconductor supply chain?
Despite slumping in 2023, wafer fab equipment revenue will stabilize and recover, announces Yole Intelligence.
- The total market is worth US$87 billion in 2023 and is expected to reach US$107 billion in 2028, at a 4.3% CAGR 23-28.
- The revenue of top equipment vendors, e.g. Lam Research, Applied Materials or Nikon; is decreasing in 2023 while smaller players are thriving worldwide with soaring revenue.
- Chipmakers, mostly DRAM and NAND memory (such as Samsung, Micron, SK Hynix, Kioxia) are cutting CapEx and canceling or delaying orders.
- After three consecutive years of growth, WFE vendor revenues stabilized at US$80 billion per year.
According to Yole Intelligence, part of Yole Group, after three years of consecutive record semiconductor wafer fab equipment revenues, we enter a period of equipment capacity digestion. A slight slump in wafer fab equipment revenue in Q4 2022, down 1% QoQ , led to a weak Q1 2023, down 26% QoQ, which marks the first quarter of a 2023 downturn.
Taguhi Yeghoyan, Ph.D Senior Technology & Market Analyst, Semiconductor Equipment, Subsystems and Testing Division, at Yole IntelligenceQ1 2023’s expected revenue is US$20 billion, a value similar to that generated in Q4 2020. The decline is largely due to memory chipmakers pushing back or even canceling orders, despite long equipment lead times and high fab utilization rates.”
Equipment vendors are trying to rebook these lost orders in logic or specialty devices and advanced packaging. Yet overall, 2023 revenues may fall by up to 13% YoY to US$87 billion. On top of that, the geopolitical situation brings additional headwinds to US, European, and now Japanese equipment vendors, depriving them of lucrative regional shipments. Process technologies, including etch and clean, deposition, ion implantation, metrology and inspection, show considerable revenue declines QoQ. The only exceptions are the patterning and wafer bonding segments.
On the other hand, service and support revenue is growing steadily at 1% YoY with yearly increments in the installed base of 7% YoY.
In this context, Yole Intelligence releases its new product: the Wafer Fab Equipment Market Monitor. In this brand-new Market Monitor, the company – part of Yole Group – tracks the market for machinery used for wafer-level semiconductor device processing on a quarterly basis. This machinery is the backbone for all semiconductor ecosystems and an enabler for subsequent chip technology advancements and social digitization.
Titre du visueljune 2021
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John West, Director, Semiconductor Equipment, Subsystems and Testing Division, Yole Intelligence“The monitor strives to understand overall wafer fab equipment vendor revenue in relation to semiconductor chipmaker revenue and CapEx, For that, the monitor tracks the historical 2016-2022 evolution of wafer fab equipment revenue and provides insight for the 2023-2028 revenue forecast. Furthermore, the monitor provides a wafer fab equipment revenue breakdown to equipment billing and service and support revenue.”
Equipment billing revenue is further detailed with respect to device application, process application, and region. Finally, the monitor provides detailed 2016-2022 market shares for each of the market segments mentioned above.
This is Yole Intelligence’s first edition of this Monitor. Quarter after quarter, the company will add companies and segments as they become relevant. Indeed, the Market Monitor is a constantly evolving service where semiconductor companies can expect improvements every period. Each quarter will also feature a focused report on a particular product or technology.
Yole Intelligence’s Semiconductor Equipment, Subsystems and Testing Division team invites you to follow the technologies, related devices, applications, and markets on www.yolegroup.com.
In this regard, don’t hesitate to discover our latest presentations:
- Wafer Fab Equipment Status – Taguhi Yeghoyan, John West during the dedicated Analyst Thursday
- Evolution of Semiconductor Technologies with New Applications Are Bringing A Bigger Stage for Test Suppliers – Lin Fu, John West during TESTCONX PHOENIX 2023
- Photolithography equipment market and technology: State and challenges – Taguhi Yeghoyan during SPIE ADVANCED LITHOGRAPHY + PATTERNING 2023
- CAGR : Compound Annual Growth Rate
- WFE : Wafer Fab Equipment
- QoQ : Quarter-on-Quarter
- YoY : Year-over-Year