Chipmaking equipment sales to slip in 2023

Market news | December 13, 2022

By Peter Clarke

wafer Materials & processes

Global OEM sales of semiconductor manufacturing equipment are set to reach a record high in 2022 before slipping back in 2023, according to industry organization SEMI.

The market will reach US$108.5 billion in 2022, an annual rise of 5.9 percent, SEMI forecasts and then in 2023 the market will contract by 16 percent to US$91.2 billion before rebounding in 2024 to US107.2 billion driven by both front-end and back-end segments.

“Emerging applications in multiple markets have set expectations for significant semiconductor industry growth this decade, which will necessitate further investments to expand production capacity,” said Ajit Manocha, CEO of SEMI, in a statement.

Annual semiconductor manufacturing equipment sales by segment; 2021 to 2024 (US$ billions). Soure: SEMI

The wafer fab equipment segment, which includes wafer processing, fab facilities, and mask/reticle equipment, is projected to expand 8.3 percent to a new industry record of US$94.8 billion in 2022, followed by a 16.8 percent contraction to US$78.8 billion in 2023 before rebounding 17.2 percent to $92.4 billion in 2024.

Equipment sales in the foundry and logic segment, accounting for more than half of total wafer fab equipment receipts, are expected to rise 16 percent year-over-year to $53.0 billion in 2022 as demand for both leading-edge and mature nodes remain strong. Foundry and logic investments are projected to decrease in 2023, and is forecast to prompt a 9 percent drop in sales across the segment.

Annual wafer fab semiconductor equipment sales by application; 2021 to 2024 (US$ billions). Source: SEMI

As enterprise and consumer demand for memory and storage weakens, equipment sales for DRAM manufacturing are expected to fall 10 percent to US$14.3 billion in 2022 and a further 25 percent to US$10.8 billion in 2023. Chipmaking equipment sales for NAND flash manufacturing are projected to drop 4 percent to $19.0 billion in 2022 and 36 percent to $12.2 billion in 2023.

Challenging macroeconomic and semiconductor industry conditions are expected to spark a decline in back-end equipment segment sales. After registering robust 30 percent growth in 2021, semiconductor test equipment market sales are forecast to slip 2.6 percent to US$7.6 billion in 2022 and 7.3 percent to US$7.1 billion in 2023.

Following an 87 percent surge in 2021, annual assembly and packaging equipment sales are projected to drop by 14.9 percent to US$6.1 billion in 2022 and by 13.3 percent to US$5.3 billion in 2023. Back-end equipment expenditures are expected to improve in 2024 with growth of 15.8 and 24.1 percent, respectively, in the test equipment and assembly and packaging equipment segments.

China, Taiwan and Korea are projected to remain the top three destinations for equipment spending in 2022. China is projected to maintain the top position next year after claiming it for the first time in 2020, while Taiwan is expected to regain the lead in 2024.