Dataquest sees IC industry 'poised for growth'
By David Lammers, EE Times
Jul 8, 2003 (10:37 AM)
AUSTIN, Texas — Gartner Dataquest analysts said Tuesday (July 8) the semiconductor equipment industry is "poised for growth," with 8 percent growth in capital spending likely this year and 15 percent growth possible for 2003.
Next year could be another banner year for the chip industry, with growth exceeding 20 percent for both 2004 and 2005, resulting in a $250 billion semiconductor industry in 2005, the San Jose, Calif.-based market research firm reported. The company is predicting 23 percent chip revenue growth in 2004, and 22 percent in 2005.
Klaus Dieter-Rinner, Dataquest's chief equipment analyst, said a rebounding U.S. economy and "cautious" improvements in corporate spending on information technology are behind "a strengthening semiconductor industry."
Japan is improving, with "slight expansion rather than contraction" as in past years for capital equipment spending, he said. Europe, however, is "stuck in a rut," he said, with Germany, for example, failing to engage in market stimulation because of European Union debt ceiling limits. Asia Pacific is being "pulled along" by stronger electronics exports to North America, he said.
Mary Olsson, an analyst in Dataquest's emerging technologies and semiconductors group, said reports from Japan show encouraging shipments of LCD and plasma televisions, DVD players, car navigation and other systems.
The personal computer market, still the largest consumer of chips by far, is showing 1 to 2 percent sequential quarterly growth, and is "waiting for a second half uptick," she said during a conference call with reporters. In Asia, improved motherboard sales are being reported, supporting the view of a strengthening PC sector following the SARS-related slowdown.
The improving outlook could result in a respectable 10 percent CAGR (compound annual growth rate) for semiconductors during the 2002-2007 period, she said. For this year, Dataquest sees an 8.3 percent growth in chip sales, and she said Dataquest is now "very confident" in that prediction, with upside potential likely.
"We are now in a fairly good recovery," Olsson concluded.
Jim Hines, who tracks the foundry market for Dataquest, said capacity utilization rates at major foundries had been in the low 60-percent range as recently as the fourth quarter of 2002. Taiwan Semiconductor Manufacturing Co. Ltd. and the overall foundry industry have reached the 80-percent utilization range, and that should increase to the 90-percent rate throughout most of 2004.
Foundries will install equipment steadily, filling out existing buildings, or shells, capable of 300-mm wafer fabrication. As production and demand both increase in parallel, utilization of capacity will remain in the 90-percent range, Hines said.
"The industry could be facing tight capacity in 2005," Hines said, adding that "significant shortages" could exist in certain "leading-edge" segments of the foundry industry in 2004-2005.
However, a "supply overshoot" could occur by 2006, resulting in another down cycle then, Hines warned. Dataquest is predicting that semiconductor revenues will shrink by 5 percent in 2006, and return to growth of 7 percent in 2007.
On Monday, IC Insights Inc. (Scottsdale, Ariz.) slightly lowered its semiconductor forecast for 2003, but it also raised its outlook for unit shipments for the year. |
