Semiconductor Industry News

[Boon]

Semiconductor Industry News

Gartner Says Worldwide Semiconductor Revenue Forecast to Grow 7.2 Percent in 2017
STAMFORD, Conn., January 23, 2017

http://www.gartner.com/newsroom/id/3578817

Worldwide semiconductor revenue is forecast to total $364.1 billion in 2017, an increase of 7.2 percent from 2016, according to Gartner, Inc. This represents a complete turnaround for the semiconductor industry as the market experienced 1.5 percent growth in 2016.

"The worst is now over with a positive outlook emerging for 2017 driven by inventory replenishment and increasing average selling prices (ASPs) in select markets, particularly commodity memory and application-specific standard products," said Ganesh Ramamoorthy, research vice president at Gartner. "The turnaround that started at the end of the second quarter of 2016 will continue to gain momentum and we expect the improved conditions to carry through 2017."

Gartner has increased the outlook for 2017 by $14.1 billion in its most current forecast, of which the memory market accounts for nearly $10 billion. "Memory market supply and demand have turned positive for memory vendors who are pushing ASPs higher to recover margins. ASP increases for application-specific standard products (ASSP), discrete and analog chips and higher semiconductor content in key applications including the Internet of Things (IoT) were the other key drivers for revenue increases," added Mr. Ramamoorthy.

Overall, the mixed growth seen in 2016 will turn into a broad and more consistent growth in 2017. Areas to watch for in 2017 are the industrial, automotive and storage markets, which are growing quickly but represent a smaller portion of the overall market. Additionally, the slow-growth outlook for traditional applications such as smartphones and PCs highlights the importance of semiconductor markets outside of these categories, notably the IoT.

"This implies that semiconductor product managers who have depended upon these categories must now continue to look for adjacent opportunities in new emerging applications in the IoT and in areas like industrial, storage and automotive markets," said Mr. Ramamoorthy.

Additional analysis on the outlook for the semiconductor market can be found in the Gartner report "Semiconductor Forecast Database, Worldwide, 4Q16 Update."
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[Wildreamz]

Thanks for the update. Another inevitable tech trend: we will use more chips in the next 10 years than today.

Vested in TSMC.

[Jacmar]

Thanks for the update. Another inevitable tech trend: we will use more chips in the next 10 years than today.

Vested in TSMC.

While it's true that we will use more chips but this does not necessarily translate into profitability. It all depends on the ASP. At the moment it's not attractive at all.
Only way to "rescue" the industry to make it profitable going forward as what he has pointed out is: IoT, Industrial (robotics) -- basically ASICs ; Storage(cloud etc) and automotive(more electronics). The current bread and butter which is the huge vol now of hp and computers is not attractive. Even for storage it's very commodity and ASP depends on supply/demand at any point in time...not attractive segment..famine/feast type.

[BlueKelah]

Spot prices for dram still going through the roof, been going on since 2H16 hence the strong performance of some in the sector like samsung amat and nvidia

Sent from my MotoG3 using Tapatalk

[Boon]

IDC: China’s VR market set for 4-fold expansion in 2017 after a wild ride in 2016 

Beijing, January 25, 2017- China's VR industry is expected to expand more than 4-fold in 2017 as more major players enter the industry and new and exciting content drives growth, IDC forecasts.
The VR industry in China experienced a roller-coaster ride in 2016, as strong growth at the beginning of the year sputtered into a disappointing finish at the end of the year. Some media outlets have declared that a winter has arrived for China VR industry. But is this true? Let us review the industry data and let the figures speak for themselves.......................................

https://www.idc.com/getdoc.jsp?container...HE42257117
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Gartner Survey Finds That Most Smartphone Users Spend Nothing on Apps
26 Jan 2017
http://www.gartner.com/newsroom/id/3583817
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Intel: Ready For The VR/AR Revolution?
Jan. 27, 2017
http://seekingalpha.com/article/4040114-...revolution
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[Boon]

China Moves To Top Spot In Fab Equipment Spending
Total will reach $10B by next year, setting record for any single region.
FEBRUARY 16TH, 2017 - BY: CLARK TSENG

http://semiengineering.com/china-1-spend...equipment/
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[Boon]

North American Semiconductor Equipment Industry Posts February 2017 Billings

MILPITAS, Calif. — March 16, 2017 — North America-based manufacturers of semiconductor equipment posted $1.97 billion in billings worldwide in February 2017 (three-month average basis), according to the February Equipment Market Data Subscription (EMDS) Billings Report published today by SEMI.
SEMI reports that the three-month average of worldwide billings of North American equipment manufacturers in February 2017 was $1.97 billion. The billings figure is 6.1 percent higher than the final January 2017 level of $1.86 billion, and is 63.8 percent higher than the February 2016 billings level of $1.20 billion.
“Billings levels remain elevated as memory and foundry manufacturers continue to invest in advanced semiconductor technologies," said Ajit Manocha, president and CEO of SEMI. “These investments are paving the way for the ramp of 3D NAND and 1X-nm devices.”.............................

http://www.semi.org/en/north-american-se...7-billings
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[Boon]

North American semiconductor equipment industry posts April 2017 billings
http://www.semi.org/en/north-american-se...7-billings
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[Boon]

Historic Highs in Fab Spending for 2017 and 2018
Equipment spending alone: US$49 billion in 2017 and $54 billion in 2018
By Christian G. Dieseldorff, Industry Research & Statistics Group, SEMI (June 5, 2017)
The latest update to the World Fab Forecast report, published on May 31, 2017 by SEMI, reveals record spending for fab construction and fab equipment. Korea, Taiwan, and China all see large investments, and spending in Europe has also increased significantly. In 2017, over US$49 billion will be spent on equipment alone, a historic record for the semiconductor industry.  Spending on new fab construction will reach over $8 billion, the second largest year on record.  Records will shatter again in 2018, when equipment spending will pass $54 billion, and new fab construction spending will hit an all-time high of $10 billion. See Figure 1........

[Image: Record-Fab-Spending-Chart.png]

These unprecedented high numbers are not only driven by a handful of well-known, established companies, but also by several new Chinese companies entering the scene. The top seven established companies are Samsung, TSMC, Intel, SK Hynix, Micron, Flash Alliance (JV between Toshiba/Western Digital), and GLOBALFOUNDRIES. Samsung, for example, is expected to pour historic levels of funds into its fabs both this year and next, mostly for 3D NAND and DRAM. Not to be outdone, Intel is also expected to be a big spender in 2017, investing heavily into 3D NAND in China and its 10nm ramp. TSMC also shows no sign of slowing down.

Several Chinese-based companies have emerged with large budgets, resulting in an increase in overall fab spending (construction and equipment together) of 54 percent year-over-year in China.  Total spending rises from $3.5 billion in 2016 to $5.4 billion in 2017, and then to $8.6 billion in 2018, another 60 percent year-over-year (YoY)).

Some of these China-based companies are well known, such as Hua Li Microelectronics or SMIC (top investors in 2017 and 2018), though newcomers in the arena, including Yangtze Memory Technology, Fujian Jin Hua Semiconductor, Tsinghua Unigroup, Tacoma Semiconductor, and Hefei Chang Xin Memory, add to the spending surge.
Breaking down fab equipment spending by region, large amounts of money are being invested in Korea, Taiwan, and China while Europe makes a big leap. See Figure 2.......................................

http://www.semi.org/en/historic-highs-fa...7-and-2018
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[weijian]

As someone from the semiconductor industry, it actually feels alarming to see these record levels of CAPEX coming up...after all the booms/busts of yesteryears. But been here for a period of time now, we learn to make hay while the sun shines.