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Global semiconductor sales top $335B in 2015

February 1, 2016

The Semiconductor Industry Association (SIA) today announced the global semiconductor industry posted sales totaling $335.2 billion in 2015, a slight decrease of 0.2 percent compared to the 2014 total, which was the industry’s highest-ever sales total. Global sales for the month of December 2015 reached $27.6 billion, down 4.4 percent compared to the previous month and 5.2 percent lower than sales from December 2014. Fourth quarter sales of $82.9 billion were 5.2 percent lower than the total of $87.4 billionfrom the fourth quarter of 2014. All monthly sales numbers are compiled by the World Semiconductor Trade Statistics (WSTS) organization and represent a three-month moving average.

“Despite formidable headwinds, the global semiconductor industry posted solid sales in 2015, although falling just short of the record total from 2014,” said John Neuffer, president and CEO, Semiconductor Industry Association. “Factors that limited more robust sales in 2015 include softening demand, the strength of the dollar, and normal market trends and cyclicality. In spite of these challenges, modest market growth is projected for 2016.”

Several semiconductor product segments stood out in 2015. Logic was the largest semiconductor category by sales with $90.8 billionin 2015, or 27 percent of the total semiconductor market. Memory ($77.2 billion) and micro-ICs ($61.3 billion) – a category that includes microprocessors – rounded out the top three segments in terms of total sales. Optoelectronics was the fastest growing segment, increasing 11.3 percent in 2015. Other product segments that posted increased sales in 2015 include sensors and actuators, which reached $8.8 billion in sales for a 3.7 percent annual increase, NAND flash memory ($28.8 billion/2.2 percent increase), and analog ($45.2 billion/1.9 percent increase).

Regionally, annual sales increased 7.7 percent in China, leading all regional markets. All other regional markets – the Americas (-0.8 percent), Europe (-8.5 percent), Japan (-10.7 percent), and Asia Pacific/All Other (-0.2 percent) – saw decreased sales compared to 2014.

“The semiconductor industry is critically important to the U.S. economy and our global competitiveness,” continued Neuffer. “We urge Congress to enact polices in 2016 that promote innovation and growth. One such initiative is the Trans-Pacific Partnership (TPP), a landmark agreement that would tear down myriad barriers to trade with countries in the Asia-Pacific. The TPP is good for the semiconductor industry, the tech sector, the American economy, and the global economy. Congress should approve it.”

December 2015
Billions
Month-to-Month Sales
Market	Last Month	Current Month	% Change
Americas	6.07	5.75	-5.2%
Europe	2.93	2.77	-5.7%
Japan	2.68	2.57	-4.1%
China	8.67	8.45	-2.5%
Asia Pacific/All Other	8.53	8.08	-5.3%
Total	28.88	27.62	-4.4%

Year-to-Year Sales
Market	Last Year	Current Month	% Change
Americas	6.73	5.75	-14.5%
Europe	3.01	2.77	-7.9%
Japan	2.80	2.57	-8.1%
China	8.03	8.45	5.2%
Asia Pacific/All Other	8.57	8.08	-5.7%
Total	29.13	27.62	-5.2%

Three-Month-Moving Average Sales
Market	Jul/Aug/Sep	Oct/Nov/Dec	% Change
Americas	5.82	5.75	-1.2%
Europe	2.87	2.77	-3.6%
Japan	2.69	2.57	-4.3%
China	8.45	8.45	0.0%
Asia Pacific/All Other	8.58	8.08	-5.8%
Total	28.41	27.62	-2.8%

Semiconductor R&D growth slows in 2015

January 21, 2016

Semiconductor industry spending on research and development grew by just 0.5% in 2015, which was the smallest increase since the 2009 downturn year and significantly below the compound annual growth rate (CAGR) of 4.0% in R&D expenditures during the last 10 years, according to IC Insights’ new 2016 edition of The McClean Report. The half-percent increase nudged worldwide R&D spending by semiconductor companies to a new record-high level of $56.4 billion in 2015 from the previous peak of $54.1 billion set in 2014, says IC Insights’ flagship market analysis and forecast report on the IC industry.

Growing concerns about the weak global economy, slumping sales in the second half of the year, and unprecedented industry consolidation through a huge wave of merger and acquisition agreements weighed on semiconductor R&D spending in 2015. The new 2016 McClean Report shows Intel continuing to lead all semiconductor companies in R&D spending in 2015, accounting for 22% of the industry’s total research and development expenditures. The top 10 R&D ranking is shown in Figure 1.

Following Intel in the 2015 R&D ranking are Qualcomm, Samsung, Broadcom, and the world’s largest wafer foundry, TSMC. The top five spenders were unchanged from 2014, but below that point, the rankings of most companies were shuffled. Micron Technology moved up to sixth in 2015, swapping positions with Toshiba, which fell to seventh in the new ranking. MediaTek went from ninth in 2014 to eighth place, while SK Hynix climbed from 12th to ninth in 2015. ST slid from eighth in 2014 to 10th in 2015, and Nvidia fell out of the top 10 to 11th place in 2015.

The top 10 in the R&D ranking collectively increased spending on research and development in 2015 by about 2% compared to the half-percent increase for total semiconductor R&D expenditures in the year. Combined R&D spending by the top 10 exceeded total expenditures by the rest of the semiconductor companies (about $30.8 billion versus $25.6 billion) in 2015—something that has continued to hold true since 2005 and probably well before that, according to The 2016 McClean Report, which becomes available in January 2016.

Figure 1

Additional details on semiconductor R&D spending and other technology trends within the IC industry are provided within the IC industry are provided in The McClean Report—A Complete Analysis and Forecast of the Integrated Circuit Industry (released in January 2016).

Switchable material could enable new memory chips

January 20, 2016

Two MIT researchers have developed a thin-film material whose phase and electrical properties can be switched between metallic and semiconducting simply by applying a small voltage. The material then stays in its new configuration until switched back by another voltage. The discovery could pave the way for a new kind of “nonvolatile” computer memory chip that retains information when the power is switched off, and for energy conversion and catalytic applications.

The findings, reported in the journal Nano Letters in a paper by MIT materials science graduate student Qiyang Lu and associate professor Bilge Yildiz, involve a thin-film material called a strontium cobaltite, or SrCoOx.

Usually, Yildiz says, the structural phase of a material is controlled by its composition, temperature, and pressure.

“Here for the first time,” she says, “we demonstrate that electrical bias can induce a phase transition in the material. And in fact we achieved this by changing the oxygen content in SrCoOx.”

“It has two different structures that depend on how many oxygen atoms per unit cell it contains, and these two structures have quite different properties,” Lu explains.

One of these configurations of the molecular structure is called perovskite, and the other is called brownmillerite. When more oxygen is present, it forms the tightly-enclosed, cage-like crystal structure of perovskite, whereas a lower concentration of oxygen produces the more open structure of brownmillerite.

The two forms have very different chemical, electrical, magnetic, and physical properties, and Lu and Yildiz found that the material can be flipped between the two forms with the application of a very tiny amount of voltage — just 30 millivolts (0.03 volts). And, once changed, the new configuration remains stable until it is flipped back by a second application of voltage.

Strontium cobaltites are just one example of a class of materials known as transition metal oxides, which is considered promising for a variety of applications including electrodes in fuel cells, membranes that allow oxygen to pass through for gas separation, and electronic devices such as memristors — a form of nonvolatile, ultrafast, and energy-efficient memory device. The ability to trigger such a phase change through the use of just a tiny voltage could open up many uses for these materials, the researchers say.

Previous work with strontium cobaltites relied on changes in the oxygen concentration in the surrounding gas atmosphere to control which of the two forms the material would take, but that is inherently a much slower and more difficult process to control, Lu says. “So our idea was, don’t change the atmosphere, just apply a voltage.”

“Voltage modifies the effective oxygen pressure that the material faces,” Yildiz adds. To make that possible, the researchers deposited a very thin film of the material (the brownmillerite phase) onto a substrate, for which they used yttrium-stabilized zirconia.

In that setup, applying a voltage drives oxygen atoms into the material. Applying the opposite voltage has the reverse effect. To observe and demonstrate that the material did indeed go through this phase transition when the voltage was applied, the team used a technique called in-situ X-ray diffraction at MIT’s Center for Materials Science and Engineering.

The basic principle of switching this material between the two phases by altering the gas pressure and temperature in the environment was developed within the last year by scientists at Oak Ridge National Laboratory. “While interesting, this is not a practical means for controlling device properties in use,” says Yildiz. With their current work, the MIT researchers have enabled the control of the phase and electrical properties of this class of materials in a practical way, by applying an electrical charge.

In addition to memory devices, the material could ultimately find applications in fuel cells and electrodes for lithium ion batteries, Lu says.

“Our work has fundamental contributions by introducing electrical bias as a way to control the phase of an active material, and by laying the basic scientific groundwork for such novel energy and information processing devices,” Yildiz adds.

In ongoing research, the team is working to better understand the electronic properties of the material in its different structures, and to extend this approach to other oxides of interest for memory and energy applications, in collaboration with MIT professor Harry Tuller.

A wild ride in 2015 – and two steps forward in 2016

January 7, 2016

By Denny McGuirk, SEMI president and CEO

“In like a lion, out like a lamb” is just half the story for 2015. While initial expectations forecasted a double-digit growth year, the world economy faded and dragged our industry down to nearly flat 2015/2014 results.

However, 2015 will be remembered for a wild ride that fundamentally changed the industry. In 2015 a wave of M&A activity swept across the industry supply chain — unlike any single year before — with scores of transactions and notable multi-billion dollar companies being absorbed. In 2016, we all will be working within a newly reconfigured supply chain.

Increasingly, in this business landscape, collaboration is required simultaneously across the extended supply chain — customers’ customers’ customers are now routinely part of the discussion in even unit process development. Facilitating interaction and collaboration across the extended supply chain is part of what SEMI does and I’ll be updating you in next week’s letter on how, but first, let’s review what’s happened and what’s happening.

2015 Down 1%: “In Like a Lion, Out Like a Lamb”

2015 had an optimistic start with a strong outlook and good pace in Q1 and 1H. In January 2015 forecasters projected semiconductor equipment and materials growing in a range of 7 percent to nearly 14 percent vs. 2014. Global GDP, as late as May 2015, was pegged at 3.5 percent for 2015 after coming in at only 3.4 percent in 2014. In August, estimates dropped to 3.3 percent, in November estimates dropped further to 3.1 percent for the year.

As our industry has matured, semiconductor equipment and materials growth rates are ever more tightly correlated to shifts in global GDP. With global GDP unexpectedly dropping, the second half saw declining book-to-bill activity and the year will likely end flat or slightly negative for 2015. Though nearly flat, the numbers are still impressive with a healthy $37.3 billion annual revenue for semiconductor manufacturing equipment and $43.6 billion for semiconductor materials.

An important change is since the 2009 financial crisis, electronics, chips, and semiconductor equipment and materials markets have been much more stable year-to-year than in the years prior to 2009. Also, the movement of the three segments is much more synchronized compared to the earlier years of boom and bust. For SEMI’s members this means cycles are becoming more muted — enabling members to shift business models accordingly to better maintain prosperity.

2015’s $125⁺ Billion M&A: Inflection Point for Silicon Valley Icons and Global Titans

2015 is a year that will be viewed as an inflection point in our industry. The unprecedented M&A volume (more than $125 billion for semiconductor related companies) and the size of individual deals through the electronics supply chain will forever change the industry.

While there have been waves of consolidation for semiconductor Integrated Device Manufacturers (IDMs) in the 1980s and 1990s, and semiconductor equipment and materials in the 1990s and 2000s, the fabless semiconductor companies are the latest wave undergoing consolidation. Although, in 2015, not just fabless, but all segments saw major deals — even iconic chemical brands DuPont and Dow Chemical announced their intention to merge.

Large and familiar brands like Broadcom (Avago), SanDisk (Western Digital), Altera (Intel), Freescale (NXP), and KLA-Tencor (Lam Research) have been merged and will continue forward as part of their acquirers. China is on the move with its ambitions to quickly grow its indigenous semiconductor supply chain with recent acquisitions of ISSI, OmniVision, NXP RF power unit, and notably Mattson in the semiconductor equipment segment.

In an age when new fab costs are pushing double-digit billions of dollars and leading-edge device tapeouts are surpassing $300 million per part, consolidation is a strategy to increase scale, leverage R&D, and compete better. For SEMI’s members, the winner-take-all stakes increase and raise expectations for technology, product performance, application development, speed, and support. This, in turn, means that SEMI members have an increased need for a newly drawn pre-competitive collaboration model along the extended electronics supply chain and for Special Interest Groups (SIGs) to drive collective action in focused sub-segments and for specific issues.

Source: SEMI (www.semi.org), 2015

2016 Up ~1%: Stay Close to your Customer and your Customer’s Customer and …

Current projections for semiconductor equipment and materials suggest that 2016 will not be a high growth year. The span of forecasts ranges from almost -10 percent to +5 percent. At SEMI’s Industry Strategy Symposium (ISS), 10-13 January, we will be taking a deep-dive into the 2016 forecast and on the business drivers and will have a much better picture of the consensus outlook.

However, it is already quite clear that following this enormous wave of consolidation, the industry will look different and will offer new and different opportunities. Listening to SEMI’s members, I’ve heard that during this period of upheaval it’s absolutely critical to stay close to one’s customers – but more than that – to have access and ongoing direct dialogue with the customer’s customer … and customers’ customers’ customers.

In light of the cost of research and development, the magnitude of risks, and the speed of new consumer electronics adoption, SEMI members find that they need to intimately know emerging requirements two to three steps away in the supply chain, and may require rapid and innovative development from their own sub-suppliers to meet product delivery in time. In parallel, we see system integrators (electronics providers) staffing up with semiconductor processing engineers and equipment expertise, both for differentiation of their own products and for potential strategic vertical manufacturing.

2016 will mark an acceleration of collaboration and interdependence across the extended supply chain. Next week, I’ll provide an update letter on SEMI’s related activities with an overview of what SEMI is doing to meet the realities of a reshaped industry. SEMI’s role is evolving, and more important now than ever, in helping the industry achieve together, what it cannot accomplish alone.

Learn more about SEMI membership and upcoming events.

Imec boosts performance of beyond-silicon devices

December 10, 2015

At this week’s IEEE IEDM conference, nano-electronics research center imec demonstrates record enhancement of novel InGaAs Gate-All-Around (GAA) channel devices integrated on 300mm Silicon and explores emerging tunnel devices based on optimization of the same III-V compound semiconductor.

III-V-on-Si GAA devices with a record peak transconductance at 0.5V has been achieved by optimizing both the channel epitaxy quality and the gate-channel passivation. In search of device technologies beyond FinFETs and GAA-nanowires for sub-0.5V operations, imec investigates InGaAs Tunnel-FET (TFETs). Homo-junction III-V TFETs achieving a record ON-state current (I_ON) and superior subthreshold swing have been demonstrated. These results increase the knowledge on the impact of defectivity and channel optimization on device operations, and pave the way to advanced logic devices based on III-V-On-Si for high performance or ultra-low power applications.

Imec’s R&D program on advanced logic scaling is targeting the new and mounting challenges for performance, power, cost, and density scaling for future process technologies. One of the directions that imec is following, looks into beyond-Si solutions, such as integrating high-mobility materials into the channels of CMOS devices to increase their performance, and the integration challenges of these materials with silicon. Gate-All-Around Nanowire (GAA NW) FETs have been proven to offer significantly better short-channel electrostatics, and quantum-well FinFETs (with SiGe, Ge, or III-V channels) achieving high carrier mobility, are interesting concepts to increase device performance. Tunnel FETs, on the other hand, offering a steeper than 60mV/dec subthreshold swing, are a promising option for ultra-low power applications.

At IEDM, imec presented gate-all-around InGaAs Nanowire FETs (Lg=50nm) that performed at an average peak transconductance (g_m) of 2200µS/µm with a SS_SAT of 110mV/dec. Imec succeeded in increasing the performance by gate stack engineering using a novel gate stack ALD inter-layer (IL) material developed by ASM, and high pressure annealing. The novel IL/HfO2 stack achieved a 2.2 times higher g_m for a device with a gate length (Lg) of 50nm, compared to the reference Al₂O₃/HfO₂ stack.

Imec also presented a planar InGaAs homo-junction TFET with 70 percent Indium (In) content. The increase of In content from 53 to 70 percent in a 8nm channel, was found to significantly boost the performance of the device. A record ON-state current (I_ON) of 4µA/µm (I_OFF = 100pA/µm, V_dd = 0.5V and V_d = 0.3V) with a minimum subthreshold swing (SS_min) of 60mV/dec at 300k was obtained for a planar homo-junction TFET device. It was also shown that subthreshold swing and transconductance in TFET devices were more immune to positive bias temperature instability (PBTI) compared to MOSFET devices.

“Imec’s R&D enables Moore’s Law beyond the 5nm technology node through 3 approaches. First, we are tackling the technology challenges to extend silicon CMOS devices towards smaller nodes. At the same time, we research into disruptive heterogeneous solutions for beyond-silicon CMOS devices to increase performance and introduce new functionalities. Lastly, imec pursues emerging beyond-CMOS devices and systems such as spintronics to investigate further functional scaling beyond device-density-driven scaling,” stated Aaron Thean, vice president and director of imec’s advanced logic R&D program. “Boosting the performance of advanced compound semiconductor logic devices is extremely important, and these results support the quest of the semiconductor industry to find solutions that enable 5nm technology nodes and beyond.”

“ASM and imec have a long history of R&D collaboration using many of ASM’s products and advanced deposition and thermal processes,” says Ivo Raaijmakers, ASM CTO and Director of R&D. “As a leader in ALD, we are glad to see this breakthrough new ALD material now demonstrated in imec’s high mobility devices and presented at IEDM 2015.”

Imec’s research into advanced logic scaling is performed in cooperation with imec’s key partners in its core CMOS programs including GlobalFoundries, Intel, Micron, Panasonic, Qualcomm, Samsung, SK Hynix, Sony and TSMC.

TEM of complete gate-all-around InGaAs Nanowire FET and HRTEM of the gatestack

It’s all about packaging – in this material world, who is your partner?

November 5, 2015

By Dr. Dan Tracy, Senior Director, Industry Research and Statistics, SEMI

With the recent release of Apple’s 6s and the form factors of internet enabled mobile devices and the emergence of the IoT (Internet of Things), advanced packaging is clearly the enabling technology providing solutions for mobile applications and for semiconductor devices fabricated at 16 nm and below process nodes. These packages are forecasted to grow at a compound annual growth rate (CAGR) of over 15% through 2019. In addition, the packaging technologies have evolved and continue to evolve so to meet the growing integration requirements needed in newer generations of mobile electronics. Materials are a key enabler to increasing the functionality of thinner and smaller package designs and for increasing the functionality of system-in-package solutions.

Figure 1: Packaging Technology Evolution – Great Complexity in Smaller, Thinner Form Factors, courtesy of TechSearch International, Inc.

The observations related to mobile products include:

New package form factors to satisfy high-performance, high-bandwidth, and low power consumption requirements in a thinner and smaller package.
Packaging solutions to deliver systems-in-package capabilities while satisfying low-cost requirements.
Shorter lifetimes and differing reliability requirements. For example, high-end smartphones and tablets, the key high reliability requirement is to pass the drop test; and packaging material solutions are essential to delivering such reliability.
Shorter production ramp times to meet time-to-market demands of end product. This is becoming critical and causes redundancy in capacity to be required, capacity that is underutilized for part of the year

Packaging must provide a low-cost solution and have an infrastructure in place to meet steep ramps in electronic production. The move towards bumping and flip chip has only accelerated with the growth in mobile electronics, though leadframe and wirebond technologies remain as important low-cost alternatives for many devices. Wafer bumping has been a major packaging market driver for over a decade, and with the growth in mobile the move towards wafer bumping and flip chip has only accelerated with finer pitch copper pillar bump technology ramping up. Mobile also drives wafer-level packaging (WLP) and Fan-Out (FO) WLP. New wafer level dielectric materials and substrate designs are required for these emerging package form factors.

Going forward, the wearable and IoT markets will have varying packaging requirements depending on the application, the end use environment, and reliability needs. Thin and small are a must though like other applications cost versus performance will determine what package type is adopted for a given wearable product, so once more leadframe and wirebonded packages could be the preferred solution. And in many wearable applications, materials solutions must provide a lightweight and flexible package.

Such packaging solutions will remain the driver for materials consumption and new materials development, and the outlook for these packages remain strong. Materials will make possible even smaller and thinner packages with more integration and functionality. Low cost substrates, matrix leadframe designs, new underfill, and die attach materials are just some solutions to reduce material usage and to improve manufacturing throughput and efficiencies.

SEMI and TechSearch International are once again partnering to prepare a comprehensive market analysis of how the current packaging technology trend will impact the packaging manufacturing materials demand and market. The new edition of “Global Semiconductor Packaging Materials Outlook” (GSPMO) report is a detailed market research study in the industry that quantifies and highlights opportunities in the packaging material market. This new SEMI report is an essential business tool for anyone interested in the plastic packaging materials arena. It will benefit readers to better understand the latest industry and economic trends, the packaging material market size and trend, and the respective market drivers in relation to a forecast out to 2019. For example, FO-WLP is a disruptive technology that impacts the packaging materials segment and the GSPMO addresses this impact.