Critical subsystems suppliers are the superstars of the semiconductor supply chain
Much of the focus is on equipment makers, but their suppliers are innovating new solutions crucial to enabling advanced chip production.
The companies that supply critical subsystems to semiconductor equipment manufacturers are innovating new solutions. They address complex issues arising from the fabrication of more advanced chips.
The transition to sub 5nm and lower nodes presents a range of new problems to be solved – in terms of contamination levels, vibrations, plasma control for dry etching, and more. These are driving a sea change in terms of technical requirements and performance.
Semiconductor equipment subsystems are parts that are crucial to operate the equipment smoothly. At Yole Group, analysts have categorized these subsystems into eight segments: process monitoring, power, wafer handling, thermal control, fluid management, vacuum, optical and other.
While semiconductor equipment companies such as ASML, Applied Materials, and Lam Research lead the headlines, they are heavily reliant on less well-known subsystems suppliers – including Advanced Energy, COMET, Edwards, MKS Instruments, VAT, XP Power, Zeiss, and Zygo, notes Gaël Giusti,Senior Technology & Market Analyst, Semiconductor Equipment at Yole Group.
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Suppliers must address evolving technical requirements
The increasing demand for more advanced, intricate chips for applications such as high-power computing, artificial intelligence and automotive manufacturing requires equipment subsystems that can provide more monitoring and control during fabrication.
For example, in the market for RF power subsystems – generators and their corresponding matching networks – requirements for plasma control are changing. These subsystems are primarily used to generate and control plasma density, including at the wafer level, with a bias for typically dry etch and clean applications. There is an increasing need for more precision that suppliers such as Advanced Energy, MKS Instruments and COMET are competing to provide, offering new solutions to improve plasma process tools.
“As the number of layers for DRAM memory keeps increasing, more and shorter process steps are required for even finer features, and the need to control the plasma very tightly is growing strongly. This clearly adds complexity to an already complex process.”
Multi-level pulsing for the generator is increasingly used for advanced nodes and requires complex matching algorithms to be able to adjust the plasma as fast as possible to minimize any change in the chamber that could have a negative impact on the process. Additionally, to control the energy of ions impacting the wafer, there is a need for complex wafer bias in terms of signal. Instead of having traditional RF signals, more complex waveforms are required to finely tune the plasma and the associated ion energy at the wafer level.
In process monitoring for advanced nodes, there is a need for more real-time solutions. Manufacturers need more control and sensorization at the chamber level – including the use of vacuum valves — or at the sub-fab level where vacuum pumps and gas abatement systems are increasingly being installed to ensure the process is fully optimized.
“Residual gas analyzers were used traditionally but now we are increasingly seeing another technique – time-of-flight residual gas analysis. This provides real-time information to finely monitor processes such as ALD and make sure the surface-level reactions are fully completed. We are precisely seeing increasing use of ALD tools for advanced memory and logic, so it makes sense to have more techniques like time-of-flight residual gas analysis being used in the past year or two.”
Process monitoring subsystems are mainly supplied by Switzerland-based Inficon and US-based MKS Instruments.
Vacuum valves at the leading edge with the least vibration generation and contamination potential, such as those supplied by VAT Valves in Switzerland, are almost becoming a separate ecosystem. Vacuum pumps are primarily supplied by Edwards, which is based in the UK and owned by Atlas Copco.
In the DC power segment, subsystems are used for electrostatic-chuck, chamber power, wafer bias (pulsed DC for dry etch applications) and, importantly, ion implantation. The challenge is to maintain a stable DC power supply during the entire implantation process for better doping control and homogeneity, particularly for silicon carbide which is challenging to dope. XP Power and Advanced Energy are the leading suppliers addressing these requirements.
The high-precision optics segment is critical for photolithography, inspection, DUV, and EUV tools, and the need for the highest possible resolution presents challenges for suppliers. Manufacturing lenses for DUV tools with larger diameters at high quality, with higher levels of surface smoothness and material purity, is a task that only a few industry players can achieve — such as Zeiss and Jenoptik in Germany. Meanwhile, reflective optics for EUV uses mirrors rather than lenses. These use ultra-thin alternating layers (Mo/Si, for instance) are complex and time-consuming to fabricate, as many layers with fine interfaces are needed to perfectly reflect EUV radiation and minimize losses.
Subsystems suppliers remain central to semiconductor equipment market
Subsystems suppliers, primarily based in Europe, Japan and the US, will continue to play a crucial role in the equipment market.
Demand from China supported the equipment market last year amid a decline driven by excess inventories at subsystems and wafer fabrication equipment suppliers and could also drive the markets higher in 2024.
While China is banned from importing equipment from those regions, its quest to develop its own domestic industry will face barriers to entry owing to a lack of credible subsystems suppliers. Chinese equipment makers will have to look elsewhere as supply is captive to the leading players. And building advanced equipment from the components is far more complex than engineering – there is a large amount of intellectual property involved.
Critical subsystems suppliers suffered a 7.5% decline in revenues in 2023 as inventory levels climbed on lower demand from equipment manufacturers. However, the market is set to resume a level of growth this year ahead in the 3-5% range ahead of a rebound in 2025.
As part of the Manufacturing & Global Supply Chain activities at Yole Group, Gaël’s expertise is focused on materials, equipment & parts, and manufacturing processes. He is involved daily in the production of technology & market products and custom consulting projects.
Prior to Yole Group, Gaël served as an R&D engineer at Sil’Tronix Silicon Technologies for 5 years, where he was in charge of growing epitaxial AlN thin film on sapphire for RF applications.
Gaël holds a master’s degree from ENSICAEN (Caen, France) as well as a PhD in Materials Science from the University of Birmingham (UK).
Gaël Giusti Senior Technology & Market Analyst, Semiconductor Equipment at Yole Group.“As the number of layers for DRAM memory keeps increasing, more and shorter process steps are required for even finer features, and the need to control the plasma very tightly is growing strongly. This clearly adds complexity to an already complex process.”
