Worldwide semiconductor capital spending is projected to grow 2.5 percent in 2015, to $66.1 billion, according to Gartner Inc. This is a down from the 4.1 percent growth predicted in the previous quarter’s forecast.
“Since the previous quarter’s forecast, continued weakness in the euro and yen have created major weaknesses in the overall equipment market picture,” says Bob Johnson, research vice-president at Gartner. “With over half of all equipment being produced by either Japanese or European suppliers, the weakness in their currencies has been the primary factor in our reducing our overall outlook for 2015. Longer term, we expect modest growth throughout the semiconductor cycle, with just a pause in the equipment market growth expected in 2016, as DRAM goes through a typical cyclical downturn.”
(see Table 1)
Foundries will continue to outspend the logic integrated device manufacturers (IDMs) in 2015. Worldwide foundry spending is forecast to increase 17.2 percent, in contrast with the 1.4 percent decline in total logic spending. However, the longer-term outlook for total logic spending is strong as predicted mobility market saturation will dampen the need for new capacity and create an environment where existing capacity is upgraded to the latest node.
Worldwide memory capital spending remains strong for 2015, with a 3.2 percent increase anticipated, compared with a 10.2 percent increase in the previous quarter’s forecast. The reduction from the previous forecast is a result of spending announcements by major manufacturers, which were lower than previously anticipated, and reflected the fact that major equipment types are cheaper due to weaknesses in exchange rates. Memory manufacturers currently enjoy a strong chip-pricing environment, which sets the stage for continued spending growth through 2015. However, an anticipated oversupply in DRAM in 2016 will lead to a 13.6 percent decrease for worldwide memory spending next year.
Wafer-level equipment spending is forecast to increase 0.1 percent in 2015, as manufacturers pull back on new fab construction and concentrate instead on ramping up new capacity. “As we get better visibility into individual company spending plans for 2015, it is apparent that caution is a prevailing sentiment, with the exception of memory, where manufacturers are adding capacity in response to favorable market conditions,” Johnson says.
This research is produced by Gartner’s Semiconductor Manufacturing program. This research program, which is part of the overall semiconductor research group, provides a comprehensive view of the entire semiconductor industry, from manufacturing to device and application market trends.
Additional analysis on the outlook for the semiconductor market can be found in the Gartner Webinar “2Q15 Semiconductor Manufacturing Forecast Update.”