SEMI predicts global sales to drop by 18.4 percent this year because of the ongoing geopolitical tensions

Semiconductor Equipment Manufacturing Industry (SEMI)

On Thursday it was stated by SEMI that the global sales of semiconductor manufacturing equipment by original equipment manufacturers were expected to fall to US$52.7Bn in 2019 year-on-year of US$64.5Bn.

The United States-based Semiconductor Equipment Manufacturing Industry (SEMI) provided a downbeat outlook for the industry as it predicts global sales to drop by 18.4 percent this year because of the ongoing geopolitical tensions before retrieving next year.

However, the firm was more optimistic for the next year and it anticipates an 11.6 percent increase to US$58.8Bn.

SEMI stated that the current forecast reflects the latest downward adjustments in capital expenditures & rising market ambiguity due in part to geopolitical tensions.

Mid-Year Forecast of SEMI shows wafer processing equipment sales dropping 19.1 percent this year to US$42.2Bn.

The other front-end segment, consisting of wafer manufacturing, fab facilities equipment, and reticle equipment, is anticipated to smoothly decrease 4.2% to US$2.6Bn this year.

The segment of packaging & assembly equipment is expected to decline 22.6 percent to US$3.1Bnl in 2019, while semiconductor test equipment is expected to drop 16.4 percent to US$4.7Bn this year.

SEMI predicts that Taiwan will dethrone South Korea as the largest equipment market & lead the world with 21.1 percent growth this year, followed by North America with an 8.4 percent uptick.

China will be maintaining the 2nd spot for the consecutive 2nd year, and Korea will be falling to 3rd after adjusting back capital expenditures. All regions forecasted except Taiwan & North America will contract this year.

SEMI expects that, in the next year, the equipment market is likely to recover on the strength of memory spending & novel projects in China.

There will be an increase in the Equipment sales of Japan 46.4 percent to US$9Bn. Korea, China, and Taiwan are predicted to remain the leading three markets in the coming year, with China rising to the top for the first time.