Business Trends
03/01/2003
December chip sales dip, equipment sales rise
Global chip sales reached $12.5 billion in December, a 2.3% drop from the $12.8 billion in revenue reported in November, according to the Semiconductor Industry Association (SIA), San Jose, CA.
During the year's final quarter, revenue rose 1.9% sequentially to $37.6 billion from $36.9 billion, up 23% over the corresponding quarter of 2001.
"The recovery that began in the final quarter of 2001 continued throughout 2002, producing 1.3% growth in this turnaround year," stated SIA president George Scalise.
The North American-based manufacturers of semiconductor equipment posted $839 million in orders in December 2002 and a book-to-bill ratio of 0.98, according to Semiconductor Equipment and Materials International (SEMI).
The three-month average of worldwide bookings in December was $839 million. The bookings figure is 8% above the revised November 2002 level of $777 million and 37% above the $614 million in orders posted in December 2001.
Frontend capacity utilization totaled 80.7% in December 2002, down from November's revised 82.2%, according to VLSI Research Inc.'s Industry Pulse Pro. That number is projected to fall to 76.3% in January, according to VLSI.
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Additionally, the research firm said that worldwide equipment sales and bookings each totaled $2.5 billion in December, resulting in a book-to-bill ratio of 1.0, up from November's revised book-to-bill ratio of 0.97.
The steady increase in the book-to-bill ratios for both equipment and ICs in 4Q02 indicates that business conditions are improving, according to VLSI Research. Unfortunately, it has been so slow that any upward movement is almost undetectable, the research firm added. Economic uncertainty continues to plague all levels of the supply chain and lack of confidence may be killing off a consumer-led recovery.
WORLDWIDE HIGHLIGHTS
VLSI Research predicts that chip revenues will increase 22% in 2003, while chip equipment revenues will grow 11.7%.
The equipment industry recorded total revenues of $29.9 billion in 2002, which was less than half of 2000's peak.
As CY02 came to a close, the chipmaking industry ended the year showing 1.9% growth from 2001, while equipment makers registered a decline of 23.8%, VLSI Research reported.
VLSI contradicts what it says is a dark picture painted by the news. The economy has been rising for a year, VLSI said, at an average growth of some 3%.
Durable goods' buying is shifting from autos to IT, the research firm said. Consumer spending continues to be strong. Although communications is nearly "dead," there is the occasional sign of life, VLSI added.
Chipmakers are relatively healthy. Utilization cuts "did the trick" and they managed to halt the rising trend in IC inventories. VLSI also pointed out that utilization is a problem with equipment makers, and it has been worsened by leading-edge capacity equipment at bargain basement prices.
USA
Ibis Technology Corp., Danvers, MA, has signed a joint development agreement with IBM to create a next-generation, modified low-dose process for manufacturing SIMOX-SOI wafers. Aimed at producing lower-cost, higher-quality wafers with thinner top silicon layers, the joint development work will be conducted at both companies.
Shipley Co., Marlborough, MA, has signed a joint development agreement with Therma-Wave Inc., Fremont, CA. The companies plan to develop scatterometric methods to measure ≤130nm photoresist features for polysilicon gate and shallow trench applications.
Fairchild Semiconductor, South Portland, ME, estimated that about 100 employees would lose jobs at its Pennsylvania fab, as it closes the 150mm wafer facility to upgrade to 200mm. The projected layoffs represent at least 20% of the company's work force of 500.
Air Liquide America LP, Austin, TX, and its electronics business segment have constructed an ultra-clean analytical laboratory in Dallas, TX. Several instruments have been acquired for the new 2400 ft2 lab, which features a 1500 ft2 Class 1 cleanroom. The lab will analyze parts/trillion levels of impurities in ultrapure water and chemicals, and will support new semiconductor processes. Some examples of these processes include low-k precursors, copper-plating chemistries, and CMP slurries.
The US Air Force Research Lab (AFRL) has awarded its new "High-k Dielectric Research for the Development of High-Performance, Compact Capacitors for Pulse Forming" to American Semiconductor Inc., Boise, ID. The research will apply high-k dielectric materials to pulsed power capacitors, an enabling technology for future weapon systems and a key requirement of the ITRS roadmap for next-generation semiconductor devices.
Hitachi High Technologies Corp., a subsidiary of Hitachi Ltd., has joined the SiLKnet Alliance data network to develop etch processes compatible with SiLK and porous SiLK semiconductor dielectric resins. The SiLKnet Alliance, is sponsored by The Dow Chemical Co.
ASIAFOCUS
China
Shanghai Hua Hong NEC Electronics Co., a joint venture of NEC Corp., will resume capital spending this year for the first time since 2001. The joint venture will spend about ¥10 billion to raise its capacity by 60% in 2003, which will boost its monthly output from 20,000 to 32,000 200mm silicon wafers.
The BOE Technology Group Co. has completed the purchase of Hynix Semiconductor Inc.'s FPD unit for $380 million. The newly formed company, BOE-Hydis Technology Co., will continue to be based in Ichon, on the outskirts of Seoul. It will produce mostly 17-in. TFT-LCDs and will employ about 1700 workers.
Israel
Given Imaging Ltd., Yoqneam, and Micron Technology, Boise, ID, have entered into an agreement in which Micron will develop and supply current and next-generation CMOS image sensors for Given Imaging. The five-year, mutually exclusive development and supplier agreement includes the option of five one-year extensions.
Japan
Dai Nippon Printing Co., Tokyo, will invest ¥12 billion by 2005 to mass produce photomasks for circuits with a linewidth of 90nm. In other news, Toppan Printing Co. will spend ¥15 billion by 2Q03 to set up five more lines to produce photomasks for chips with linewidths of 90- and 130nm.
 Japan tool orders dropped 20.2% in November to Y55.7 billion. |
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Now that Selete's 130nm 300mm research line is running at the government-funded super cleanroom in Tsukuba, the organization will process wafers at cost for other companies when it is not using the facilities itself. It can run up to 1000 test wafers/.month for development and qualification of processes for its 11 members and some 70 toolmakers, primarily focusing on dielectric deposition and etch. Selete has also developed the basic technology needed to produce 65nm transistors, with a high-k dielectric film that can stand up to high heat processing, and a precision etchant from Mitsubishi Gas Chemical.
Asahi Denka Kogyo is building a $2.5 million (¥300 million) lab next to its Kashima production line to do more sophisticated analysis and quality control of its semiconductor chemicals. The new 864 m2 facility is slated for completion in August, and will include $335,000 or so (¥40 million) in new tools for analyzing molecular structures and the like.
TEL plans to set up tool-refurbishing shops in Japan and Shanghai this year, as it targets the used equipment business. TEL will establish a refurbishing shop at TEL Kyushu, and set up a unit in Shanghai as well, employing about 100 engineers. With this new push it sees possible sales of $250 million (¥30 billion) in three to five years.
Korea
Hynix Semiconductor Inc., Seoul, will sell its stakes in affiliates and other companies worth more than 300 billion won in the first half of this year. The sale is part of a move, approved by Hynix creditors, to restructure the chipmaker's finances.
Malaysia
KESM Industries Bhd. (KESMI), Kuala Lumpur, will invest, within the next five years, RM100 million (approximately $26.3 million) in machinery to increase production capacity for semiconductor burn-in and electronic components assembly. KESMI recently signed a RM50 million (approximately $13.2 million) manufacturing service agreement with Motorola on an outsourcing program.
Taiwan
Air Products Inc., Lehigh Valley, PA, has started operations at its ultra-high-purity (UHP) bulk gas production facility in the Tainan Science-Based Industrial Park in Taiwan. The $50 million plant is capable of yielding 50,000 m2 of UHP gaseous nitrogen and 400 tons/day of UHP liquid nitrogen and liquid oxygen.
UMC, Taipei, has extended its agreement to license California-based Numerical Technologies Inc.'s phase-shifting technology as the foundry migrates to the 90nm process generation. The three-year agreement takes effect immediately, continuing a licensing partnership that began in Dec. 2000. The companies will continue their ongoing collaboration for technology development to facilitate production of sub-100nm ICs, which began in early 1999.
EUROFOCUS
ICOS Vision Systems Corp. NV, Heverlee, Belgium, has signed a distribution agreement with Kestronics Ptd. Ltd. of Singapore, a subsidiary of the Sunright Group. Kestronics will distribute ICOS' lines of inspection machines in Singapore, Malaysia, Thailand, and Indonesia.
SUSS MicroTec, Munich, Germany, has installed a lithography line at the National Nano Device Laboratories in Taiwan. The line consists of a production mask aligner and a coating cluster for thin and thick resist MEMS applications.
Infineon Technologies AG, Munich, Germany, has terminated its technology license agreement with ProMOS Technologies Inc., its joint venture with Mosel Vitelic, Taipei, Taiwan, due to breach of contract and destruction of the relationship of trust between the contract partners. As a result of this termination, ProMOS will no longer be allowed to manufacture products based on Infineon technology. Also, Mosel has acquired the full chipmaking capacity of ProMos. Mosel Vitelic and Infineon ended their partnership last year due to differing views concerning the operations of ProMos, which runs 200- and 300mm fabs, and has a monthly output of 15 million DRAM chips.