YG PRESS NEWS – Wafer fab equipment industry: challenges and opportunities amidst revenue decline and technological shifts

According to Yole Intelligence, part of Yole Group, in the Wafer Fab Equipment Market Monitor, following three consecutive years of setting new records in year-over-year growth, the total revenue for wafer fab equipment (WFE) is anticipated to undergo an -8.2% reduction, declining from US$104 billion in the calendar year 2022 to US$94 billion in the calendar year 2023. After the first quarter of 2023, the second quarter of 2023 witnessed a 9% quarter-over-quarter decline, while the third quarter of 2023 appears to have stabilized at 0%. This downward trend is accompanied by a gradual decrease in order intake with each passing quarter. Nevertheless, Yole Intelligence’s analysts project a new normal of very high quarterly revenues in the range of US$20 billion to US$25 billion, and they are hopeful that the decline has reached its lowest point. The primary cause of this decline can be attributed to memory chip manufacturers delaying or even canceling orders, despite long lead times for equipment. Equipment suppliers have successfully mitigated these lost orders by selling WFE into the markets of mature logic or specialized devices (especially compound semiconductors) and advanced packaging.

The distribution of process technologies is expected to see significant shifts in 2023. Revenue from etching and cleaning, deposition, metrology, and inspection is witnessing a substantial decline, while the patterning segment is outperforming with a 24% year-over-year increase. Consequently, experts can anticipate notable changes in the market shares within the 2023 WFE market.

Lastly, the revenue from services and support is steadily increasing at a rate of 1% year-over-year, driven by annual growth in the installed base of WFE equipment, which is expanding by 7% year-over-year… For more information about this analysis, please contact us!