August 15, 2007 – Worldwide sales of semiconductor manufacturing equipment rose 3% in 2Q07 vs. the prior quarter, but that small growth was entirely on the backs of heavy investments in Taiwan and China mainly for memory operations, according to the latest data from SEMI and the Semiconductor Equipment Association of Japan (SEAJ).
Total billings in 2Q07 were $11.06 billion, about 3% higher sequentially, and almost entirely attributed to activity in Taiwan ($3.16B, +57%) and China ($1.21B, +87%). All other regions saw tool sales drop off significantly, with the biggest drop in Korea ($1.76B, -29%), followed by Rest-of-World (ROW, $630M, -20%), Europe ($640M, -18%), and Japan and North America ($2.05B and $1.6B, -10% each). Taking away the growth from Taiwan and China, the other regions collectively shrunk tool purchases by 17%.
Year-on-year, 2Q sales were 15% higher than in 2Q06, and again Taiwan and China are seen shouldering the load in tool sales (+80% and +104% respectively). Korea (16%) and Japan (6%) managed slight increases, while North America (-13%), Europe (-33%), and ROW (-37%) suffered big Y-Y declines.
Comparing regions’ sequential sales growth from 4Q06-1Q07 and 1Q02-2Q07, the data provides another angle showing how Taiwan and China aggressively increased their tool spending in 2Q vs. the prior quarter, during a spending slump from all other regions. Taiwan actually reduced equipment sales by 4% in 1Q, while China sales had risen 31%. Heading the other direction, Korea wiped out a 39% jump in 1Q tool sales with a -29% reduction in 2Q. Other regions also continued to see tool sales slow even further from 1Q-2Q as they did in the prior sequential 4Q-1Q period — Japan from -1% to -10%, North America from -7% to -10%, Europe from -10% to -18%, and ROW from -12% to -20%.
Investment by memory manufacturers was particularly strong during the first half of the year,” which culminated in “modest growth” in tool sales during 2Q, noted SEMI president Stanley Myers, in a statement.
Bookings, meanwhile, have experienced “a slight decline” — down -4% sequentially and -189% Y-Y to $10.22 billion — but nevertheless they remain at sustainable levels on par with 2006, Myers claimed.
Worldwide semiconductor equipment billings, 2Q07
(Revenues in US $M)
Region………………..2Q07………………..vs. 1Q07 (%)………………..vs. 2Q06 (%)
Europe……………………0.64………………..0.78 (-18%)………………..0.95 (-33%)
China……………………..1.21………………..0.65 (87%)………………..0.59 (104%)
Japan……………………..2.05………………..2.27 (-10%)………………..1.92 (6%)
North America…………1.60……………….1.79 (-10%)…………………..1.84 (-13%)
Korea……………………..1.76………………..2.47 (-29%)………………..1.52 (16%)
Taiwan……………………3.16………………..2.01 (57%)………………..1.76 (80%)
ROW……………………….0.63………………..0.79 (-20%)………………..1.01 (-37%)
TOTAL……………………11.06……………..10.75 (3%)…………………..9.59 (15%)
Source: SEMI/I>