Feeds

Chip-making kit vendors toast bumper year

And reduced but still strong growth in 2005

  • alert
  • submit to reddit

Intelligent flash storage arrays

Chip-making equipment manufacturers together expect sales to grow 63 per cent to $36.2bn this year, from 2003's $22.2bn total, the Semiconductor Equipment and Materials International (Semi) organisation, said yesterday.

Growth will slow in 2005, with sales rising 24 per cent to $44.9bn, before contracting in 2006. Semi's figures are derived from member companies' own expectations.

"Semi members generally believe the peak of this market cycle will occur in the second quarter of 2005," the organisation said. Growth will return in 2007, taking total sales to $48bn.

This pattern follows that anticipated by the Semiconductor Industry Association (SIA): strong growth in 2004, slowing down in 2005, a reverse in 2006, followed by a 2007 revival. The SIA's figures cover chip sales.

Market watcher Gartner expects a similar trend among chip-making kit sales - with the exception that 2007, like 2006, will be year of decline. It reckons sales will rise 50.9 per cent this year and 13.4 per cent in 2005. Sales in 2007 will slump to $35.7bn - rather less than the $48bn Semi is expecting.

This year's sales will be driven by demand for 200mm and 300mm wafer kit, Semi said. Wafer processing equipment is expected to grow 61 per cent to $23.7bn; assembly and packaging machine sales by 77 per cent to $2.9bn; and testing kit by 66 per cent to $6.9bn.

The key sales regions are China and Taiwan, with sales up 152 per cent and 140 per cent.

Semi's bullish figure contrast with yesterday's Merrill Lynch bear-like report on the sector, which prompted the investment bank to downgrade the fab equipment industry from 'overweight' to 'neutral'.

ML believes that chip buyers - primarily PC OEMs - will reduce their spending through the rest of the yearto keep inventories at low levels. With chip makers busily ramping production on the back of high demand through the first five or six months of 2004, a sudden downturn in purchasing could hit earnings hard. This will have a knock-on effect on purchases of chip-making kit. ®

Related stories

Wall Street bears take a swipe at chip stocks
Chip biz breaks quarterly fab spend record
Chip sales soar in May
SIA: 2004 will be chip biz's best yet

Top 5 reasons to deploy VMware with Tegile

More from The Register

next story
Doctor Who's Flatline: Cool monsters, yes, but utterly limp subplots
We know what the Doctor does, stop going on about it already
Facebook, Apple: LADIES! Why not FREEZE your EGGS? It's on the company!
No biological clockwatching when you work in Silicon Valley
'Cowardly, venomous trolls' threatened with TWO-YEAR sentences for menacing posts
UK government: 'Taking a stand against a baying cyber-mob'
Happiness economics is bollocks. Oh, UK.gov just adopted it? Er ...
Opportunity doesn't knock; it costs us instead
The 'fun-nification' of computer education – good idea?
Compulsory code schools, luvvies love it, but what about Maths and Physics?
Ex-US Navy fighter pilot MIT prof: Drones beat humans - I should know
'Missy' Cummings on UAVs, smartcars and dying from boredom
Sysadmin with EBOLA? Gartner's issued advice to debug your biz
Start hoarding cleaning supplies, analyst firm says, and assume your team will scatter
Don't bother telling people if you lose their data, say Euro bods
You read that right – with the proviso that it's encrypted
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Why cloud backup?
Combining the latest advancements in disk-based backup with secure, integrated, cloud technologies offer organizations fast and assured recovery of their critical enterprise data.
Win a year’s supply of chocolate
There is no techie angle to this competition so we're not going to pretend there is, but everyone loves chocolate so who cares.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Intelligent flash storage arrays
Tegile Intelligent Storage Arrays with IntelliFlash helps IT boost storage utilization and effciency while delivering unmatched storage savings and performance.