electronic equipment

Although the semiconductor chip and capital equipment markets performed well in the first half of 2020, many of the electronic equipment end markets struggled globally. World electronic equipment sales declined almost 10% in 2Q’20 vs. 2Q’19.

So far the semiconductor industry is outperforming most other manufacturing sectors. Semiconductor capital equipment shipments were up 23% globally in 2Q’20 vs. 2Q’19 and semiconductor chip 3/12 growth is still in positive territory. However there are signs of slowing.

Included in this outlook is a discussion of the financial impact of the current pandemic and a forecast for GDP growth by major region for 2020 and 2021.

Data through December showed a steady recovery in the global electronic supply chain with SEMI equipment leading the way, but in late January COVID-19 began to make its negative impact felt, snarling supply chains and shutting down factories near Wuhan, China.

We are now in the recovery phase of the current business cycle with SEMI equipment already in a growth mode. However significant economic and geopolitical concerns persist.

With all major global electronic equipment OEMs having now reported their third quarter financials, we estimate that combined equipment sales increased 0.4 percent in 3Q’19 versus 3Q’18 and 2 percent sequentially from the second versus the third quarter of this year.

Reports of 2Q’19 financials from all of the major OEMs in our 213 company global sample show that their electronic equipment sales declined 1.4 percent compared to the same quarter of last year.

The electronics markets (and global economies in general) remain fragile, but there is some glimmer of hope on the horizon.

The typical winter “seasonal slowdown” is now behind us. What can we expect as the year progresses? 

The turnaround is not “around the corner” but at least we can follow its progress!