April 3, 2006 – Thanks to the push toward increasingly complex 65nm process technologies, suppliers of lithography and process diagnostics tools managed to do OK in a down year for most other equipment segments — especially backend firms, according to data from VLSI Research Inc.
Sales for the total semiconductor equipment market amounted to $43.4 billion, about a 7% decline from 2004. The largest market, wafer processing, declined 7.1% to $23.4 billion, while test and assembly markets finished with year-on-year declines of 16.8% and 13.5% to $5.6 billion and $2.8 billion, respectively.
Equipment suppliers’ efforts to aggressively reduce cycle-times in 2004 enabled them to ship more products that year, resulting in limited backlogs entering 2005 and a higher-than-expected decline in sales in the early part of the year, noted VLSI. Also, companies with more exposure to memory manufacturers performed better, thanks to expansive capital expenditures by major memory suppliers.
The best performing segment last year — managing to maintain flat growth, vs. declines in other segments — was process diagnostics, driven by an increasing need at the 65nm node for advanced process control software and diagnostics technologies. KLA-Tencor, Accretech, Vistec, Veeco, and Nikon all did well in this category.
In the wafer processing segment, lithography tool suppliers Nikon and ASML recorded the best growth, thanks to strong demand for high-end 193nm steppers. Lam and Varian also gained ground due to “excellent performance in their respective markets,” noted VLSI.
A late-year recovery for backend test and assembly equipment segments could not make up for declines earlier in the year. Best performer by far in the test/material handling sector was Delta Design (+38%), while both Accretech and Credence outperformed the market with only single-digit declines. Among assembly firms, BE Semiconductor, Accretech, ICOS Vision, and Renesas Eastern Japan Semiconductor recorded positive growth rates.
Wafer fabrication equipment
Company 2005 sales ($M) 2004 sales % growth
Applied Materials 4444.7 5768.1 -22.9
Tokyo Electron Ltd* 3480.9 3714.0 -6.3
ASML 2786.9 2712.4 2.7
Nikon 1345.9 1214.6 10.8
Lam Research 1148.1 1129.0 1.7
Novellus Systems 1134.1 1170.5 -3.1
Dainippon Screen 912.5 978.6 -6.8
Canon 854.3 984.3 -13.2
Varian Semi. 437.5 385.4 13.5
Hitachi High-Tech 427.9 448.1 4.5
TOP 10 — 16,972.8 18,505 -8.3
TOTAL MARKET — 23,396.8 25191.0 -7.1
* TEL’s sales accounting changed from shipment-based to revenue-based in 2005; no adjustments made based on this change.
Process diagnostics equipment
Company 2005 sales ($M) 2004 sales % growth
KLA-Tencor 1643.4 1573.0 4.5
Hitachi High-Tech 569.0 587.6 -3.2
Applied Materials 338.9 417.7 -19.1
FEI 135.4 162.0 -16.4
Agilent Technologies 98.3 139.2 -29.4
Accretech/Tokyo Seimitsu 79.6 48.8 63.1
Vistec 79.3 73.5 8.0
Veeco Instruments 78.9 58.8 34.1
ADE 70.4 80.7 -12.8
Nikon 66.8 63.9 4.5
TOP 10 — 3160 3205.2 -1.4
TOTAL MARKET — 4053.3 4032.8 0.1
Test & material handling equipment
Company 2005 sales ($M) 2004 sales % growth
Advantest 1880.5 2115.1 -11.1
Teradyne 657.5 963.0 -31.7
Yokogawa Elec. 450.6 552.3 -18.4
Agilent 383.9 437.5 -12.2
Credence Systems 323.4 356.8 -9.4
Accretech/Tokyo Seimitsu 310.9 335.1 -7.2
Tokyo Electron* 285.2 319.9 -10.9
Delta Design 164.2 119.2 37.7
LTX 119.6 194.3 -38.5
ESI 103.7 152.2 -31.9
TOP 10 — 4679.5 5545.4 -15.6
TOTAL MARKET — 5640.3 6775.8 -16.8
* TEL’s sales accounting changed from shipment-based to revenue-based in 2005; no adjustments made based on this change.
Assembly equipment
Company 2005 sales ($M) 2004 sales % growth
ASMI 326.8 376.9 -13.3
Kulicke & Soffa 267.9 285.3 -6.1
Shinkawa 192.2 218.9 -12.2
BE Semi 183.2 141.8 29.2
Accretech/Tokyo Seimitsu 157.0 153.0 2.6
Disco 155.3 172.9 -10.2
ESEC 131.8 192.6 -31.6
ICOS 89.1 80.8 10.2
Renesas East. Japan Semi 87.7 53.2 64.9
TOWA 84.0 116.1 -27.6
TOP 10 — 1675 1791.5 -6.5
TOTAL MARKET — 2776.7 3211.2 -13.5