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The global semiconductor manufacturing equipment spending is projected to total $34.6 billion in 2013, an 8.5 per cent decline from 2012 spending of $37.8 billion.
Capital spending will decrease 6.8 per cent in 2013 due to diminishing 28-nanometer (nm) investment from a softening in the mobile phone market, according to a study by Gartner.
“Weak semiconductor market conditions that continued into the first quarter of 2013 generated downward pressure on new equipment purchases,” said Dean Freeman, research Vice-President at Gartner.
"However, semiconductor equipment quarterly revenue is beginning to improve, and a positive movement in the book-to-bill ratio indicated that spending for equipment will pick up in the remainder of 2013. Looking beyond 2013, we expect that the current economic malaise will have worked its way through the industry, and spending will follow a generally increasing pattern in all sectors throughout the rest of the forecast period,” Freeman added.
Logic spending has been the key driver of capital spending in 2013; however, a softening in the mobile phone market has dampened investment in 28 nm during the third quarter, and this is projected to continue into the fourth quarter of 2013. Memory spending has picked up some of the slack and total spending in the second half of 2013 should outpace the first half of the year.
Gartner said capital spending is concentrated among a handful of companies. The top three companies (Intel, TSMC and Samsung) account for more than half of 2013 spending. Spending by the top five semiconductor manufacturers exceeds 65 per cent of total 2013 spending, with the top 10 accounting for 76 per cent of the total.
2013 spending will be back-half-loaded, with capacity increases occurring as memory market conditions improve, and Intel prepares for initial 14-nm production late in the year, it added.
Gartner predicts that 2014 semiconductor capital spending will increase 14.1 per cent, followed by 13.8 per cent growth in 2015. The next cyclical decline will be a mild drop of 2.8 per cent in 2016, followed by a return to growth in 2017.
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