Worldwide semiconductor capital spending is projected to increase 2.9 percent in 2017, to $69.9 billion, according to Gartner, Inc. This is down from 5.1 percent growth in 2016 (see Table 1).
“The stronger growth in 2016 was fueled by Increased spending in late 2016 which can be attributed to a NAND flash shortage which was more severe in late 2016 and will persist though most of 2017. This is due to a better-than-expected market for smartphones, which is driving an upgrade of NAND spending in our latest forecast,” said David Christensen, senior research analyst at Gartner. “NAND spending increased by $3.1 billion in 2016 and several related wafer fab equipment segments showed stronger growth than our previous forecast. The thermal, track and implant segments in 2017 are expected to increase 2.5 percent, 5.6 percent and 8.4 percent, respectively.
Compared with early 2016, the semiconductor outlook has improved, particularly in memory, due to stronger pricing and a better-than-expected market for smartphones. An earlier-than-anticipated recovery in memory should lead to growth in 2017 and be slightly enhanced by changes in key applications.
Table 1
Worldwide Semiconductor Capital Spending and Equipment Spending Forecast, 2015-2020 (Millions of Dollars)
| 2016 | 2017 | 2018 | 2019 | 2020 | |
| Semiconductor Capital Spending ($M) |
67,994.0 |
69,936.6 |
73,613.5 |
78,355.6 |
75,799.3 |
| Growth (%) | 5.1 | 2.9 | 5.3 | 6.4 | -3.3 |
| Wafer-Level Manufacturing Equipment ($M) |
35,864.4 |
38,005.4 |
38,488.7 |
41,779.7 |
39,827.0 |
| Growth (%) | 7.9 | 6.0 | 1.3 | 8.6 | -4.7 |
| Wafer Fab Equipment ($M) |
34,033.2 |
35,978.6 |
36,241.1 |
39,272.8 |
37,250.4 |
| Growth (%) | 8.1 | 5.7 | 0.7 | 8.4 | -5.1 |
| Wafer-Level Packaging and Assembly Equipment ($M) |
1,831.2 |
2,026.8 |
2,247.6 |
2,506.9 |
2,567.7 |
| Growth (%) | 3.9 | 10.7 | 10.9 | 11.5 | 2.8 |
Source: Gartner (January 2017)
Foundries continue to outgrow the overall semiconductor market with mobile processors from Apple, Qualcomm, MediaTek and HiSilicon as the demand driver on leading-node wafers. In particular, fast 4G migration and more-powerful processors have resulted in larger die sizes than previous-generation application processors, requiring more 28 nanometer (nm), 16/14 nm and 10 nm wafers from foundries. Nonleading technology will continue to be strong from the integrated display driver controllers and fingerprint ID chips and active-matrix organic light-emitting diode (AMOLED) display driver integrated circuits (ICs).
This research is produced by Gartner’s Semiconductor Manufacturing program. This research program, which is part of the overall semiconductor research group, provides a comprehensive view of the entire semiconductor industry, from manufacturing to device and application market trends. Gartner clients can see more in “Forecast Analysis: Semiconductor Capital Spending and Manufacturing Equipment, Worldwide, 4Q16 Update.”
