Factory Automation

Gartner says worldwide semiconductor capital equipment spending to grow in 2003

JULY 10--After two difficult years, worldwide semiconductor capital equipment spending is poised to return to positive growth in 2003, according to Gartner Inc. (Stamford, CT; www.gartner.com).
July 10, 2003
2 min read

JULY 10--After two difficult years, worldwide semiconductor capital equipment spending is poised to return to positive growth in 2003, according to Gartner Inc. (Stamford, CT; www.gartner.com). Gartner analysts said there are signs the industry has started to emerge from its holding pattern, and it has started to move forward again.

Worldwide semiconductor capital spending is forecast to total $29.9 billion in 2003, a 7.9% increase from 2002. In 2002, capital spending suffered a 37.9% decline. All other segments of the semiconductor capital equipment market are on pace for increased spending in 2003. In 2002, all of these segments suffered revenue declines of at least 21%.

"On a regional basis, Japanese companies are most aggressively raising spending this year with a possible increase of 25% to 30% over 2002, funding its newly restructured ventures," Klaus-Dieter Rinnen, managing vice president for Gartner's semiconductor manufacturing and design research group. "Dynamic random-access memory (DRAM) has been strong so far, led by Samsung's aggressive plans to increase spending by more than 50% over last year. Foundry is the wild card. We expect foundry growth to be flat in 2003, but this can change in the blink of an eye."

Gartner analysts said worldwide wafer fab utilization is on the rise, with semiconductor unit demand closing in on the peak levels of 2000, with low and healthy inventory levels, and continued restraints in capital spending. For the second quarter, Gartner analysts estimate fab utilization at 81% overall and 90% for leading edge (defined as 0.18 μm and below).

"In the second half of 2003, we anticipate utilization rates to rise further," Rinnen said. "Overall utilization should cross the 85% mark during the second half of the year. Leading-edge utilization should end the year at a projected 95%. The speed at which we approach these respective thresholds and the strength of follow on demand will determine spending in the second half of this year and onward."

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