semiconductors

Speaking to nearly 300 executives gathered at the Industry Strategy Symposium (ISS) 2022 in early April, Inna Skvortsova, Market Analyst on the Market Intelligence Team at SEMI, presented upbeat industry forecasts for 2022 and beyond.

Policymakers are increasing semiconductor manufacturing capacity to strengthen supply chains and meet growing demand for semiconductors through robust incentive packages totaling hundreds of billions of dollars. This global effort hinges on semiconductor manufacturing equipment (SME).

One of the surprising side effects that came out of the COVID-19 pandemic is the acceleration of the digital transformation of global economies, which has driven a structural shift and propelled the already mature semiconductor industry to record highs.

Over the past 5 years, suppliers of chillers have shined as standout performers. These cooling systems get little attention, yet revenues have more than doubled, clocking a compound annual growth rate of 22% to reach $635 million in 2021, way above industry average growth of 13.3%.

China’s semiconductor sector has exploded to become one of the largest in the world and match the region’s prominence as the biggest consumer of chips. From 2015 to 2020 alone, revenue of China’s integrated circuit (IC) industry expanded at a rapid clip of 20% CAGR (RMB) to $128 billion.

Vacuum pumps, pressure gauges, and vacuum valves combined make up the biggest expense on the bill of materials for semiconductor OEMs. The semiconductor industry consumed almost $2.7 billion worth of vacuum subsystems in 2020, with over 60% supplied by vendors based in Europe.

After logging record shipments in the first quarter of 2021, the silicon wafer industry may need to start greenfield projects as soon as this year to boost capacity over the next two years as market demand and average selling prices continue to improve.

In 2020, the global semiconductor materials market expanded 5% to reach $55.3 billion in revenue to set a new industry record. The momentum in growth is expected to continue throughout 2021 despite the lingering pandemic.

The global semiconductor industry is on track to register a rare three consecutive years of record highs in fab equipment spending with a 16% increase in 2020 followed by forecast gains of 15.5% this year and 12% in 2022, SEMI highlighted in its quarterly World Fab Forecast report.

Despite the pandemic lock-down, demand for electronic products and services remains strong. Work-from-home, video conferencing, and remote learning are driving data center growth and laptop and tablet demand. 5G infrastructure rollout is underway and smartphone sales are returning to normal levels....