Capital Equipment Spending to Grow 45% in 2010

Worldwide spending on semiconductor equipment may be expected to end 2009 down more than 42 percent, but it is expected to bounce back with more than 45 percent growth in 2010, according to the latest data from Gartner Inc.

Specifically, the research company reported that the year is expected to show a 42.6 percent decline as compared to 2008. But, said Gartner, the market is now in the midst of a very strong growth spurt and semiconductor equipment spending is expected to increase 45.3 percent in 2010.

“Foundry spending and select spending by a few memory companies drove the growth in the semiconductor equipment segment in the second half of 2009,” said Dean Freeman, Research VP at Gartner, in a statement this morning. “2010 growth will be driven by technology upgrades for the first half of the year. The quarterly growth may see a slight lull in the third quarter of 2010 before capacity additions, starting in late 2010, ramp up the equipment industry into 2011.”

While all segments of the semiconductor equipment market experienced significant declines in 2009, all segments of the market will experience strong double-digit growth in 2010, Gartner said.

Indeed, WFE (worldwide wafer fab equipment) spending is expected to decrease 48.1 percent in 2009, but to increase 56.6 percent in 2010. Worldwide PAE (packaging and assembly equipment) spending is forecast to decrease 40.5 percent in 2009, then increase 52.8 percent in 2010. And worldwide ATE (automated test equipment) is on pace to decline 44.9 percent in 2009, but is expected to be followed by growth of 59.7 percent in 2010.

“The impact of fewer equipment customers will continue to play out in the semiconductor equipment market and further consolidation is to be expected, with mergers and acquisitions, as well as companies closing down that can no longer afford to run a business in the semiconductor industry,” said Bob Johnson, Research VP at Gartner, in the statement. “While initially this may seem to be a dark time for the equipment segment, as the industry consolidates a much stronger equipment sector will emerge to carry on in the future.”

Gartner


RELATED ARTICLES
"Positive Momentum" Reported in Foundry Arena


Foundries Still Face Challenges Despite Strong 4Q Revenue Surge

Semiconductor Market Declines Less Than Expected

Q3 Chip Sales Up Nearly 20% QoQ