September 19, 2007 – Sales of TFT-LCD array processing equipment are stuck in the mud this year, with all the top firms expected to suffer big declines from a year ago, according to data from DisplaySearch. But the future looks bright for the next couple of years, and even better into the next decade due to LCD area demand.
TEL, Ulvac, AKT, and Nikon all are projected to keep their respective top positions in the market, but each will lose roughly a third (or more) of their 2006 revenues, according to the firm. Still, all but AKT are expected to beat the overall industry’s -36% slump. Market leader TEL won’t even come close to the $699M posted by No.4 firm Nikon last year.
After spending >$10 billion in each of the past three years on equipment, TFT-LCD firms will overall cut back investments by 35% this year to $8.2 billion, in part because they’ve been losing money for nearly a year, according to Charles Annis, VP at the market research firm. The market seems to have troughed in 2Q07, though, with TFT-LCD margins expected to hit double-digits in the current quarter (3Q07) and even higher by year’s end.
TFT-LCD array equipment spending should bounce back by 13% in 2008, and another 13% in 2009, thanks to tightening supply/demand and better financial performance by panel makers. As a result, TFT array capacity will nearly double to 84.6 million sq. m. by 2012.
A longer-range picture of capacity vs. projected demand paints an impressive picture. DisplaySearch thinks 53 new fabs, each with output equivalents of 60K substrates/month, will need to be brought online in the next 10 years in order to meet growing LCD area demand.
Array equipment revenues, 2007*
(US $M)
Company…………….2007……..vs. 2006 (% change)
TEL……………………..$582……..$842 (-31%)
ULVAC……………….$489……..$742 (-34%)
AKT……………………..$487……..$815 (-40%)
Nikon………………….$485……..$699 (-31%)
Canon…………………$320……..n/a (n/a)
Other…………………$1202……..$1897 (-37%)
TOTAL………………$3564……..$5566 (-36%)
* Calculated on estimated shipments for units, ASPs, 100% payment on install, and timing in calendar years in publicly known equipment segments.
Source: DisplaySearch