Japanese equipment demand slides, but still clinging to Y-Y growth

December 8, 2004 – Demand for Japanese semiconductor manufacturing equipment continues to slide as the market sinks further into a lull entering the end of the calendar year, according to data from the Semiconductor Equipment Association of Japan (SEAJ).

Worldwide bookings of Japanese chipmaking equipment in October were ¥114.35 billion ($1.11 billion), up 3.3% from September but down 21.3% from October 2003. Slight gains in the top 2 equipment categories (wafer processing, test/inspection) were offset by big declines in manufacturing tools (-45%), and mask/reticle equipment, which evaporated from ¥3.7b in September to just ¥91m ($36.0 million) in October–and no sales outside Japan. Domestic orders of ¥72.35 billion ($703.3 million) fared better, up 15.3% month-on-month and <1% year-on-year. A 49% jump in wafer processing equipment held off steep declines in every other equipment category. Through October, worldwide sales in 2004 increased 34% from Jan.-Oct. 2003 to ¥969.59 billion ($9.43 billion), while domestic sales showed modest growth of 16% to ¥495.43 billion ($4.82 billion).

For worldwide sales, the results were bleak in October: a 50% month-on-month plunge to ¥84.26 billion ($819.1 million) with similar or worse declines across all equipment categories, although overall levels remain 35% above a year ago. Domestic sales also took a hit, down 25% to ¥59.96 billion ($582.9 million), with the only growth in wafer processing equipment (6%), and at least 50% declines in all other areas. For the 10 months through October, worldwide sales still remain strong at 79% growth (¥919.55 billion, $8.94 billion) from the same period a year ago; domestic sales are up 39% (¥437.91 billion, $4.26 billion).

The book-to-bill ratios were below the 1.0 parity mark both in Japan (0.96) and worldwide (0.91), compared with marks well above parity a year ago, although both markets increased several points from the prior month.


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