Worldwide semiconductor capital spending to grow 10.2% in 2017: Gartner

Global semiconductor capital spending is expected to increase 10.2% in 2017 to $77.7 billion, Gartner said on Wednesday. The growth rate is higher than previous quarter’s forecast of 1.4% owing to continued investment in memory which is driving spending in wafer-level equipment.

However, the spending is projected to come down to $73.2 billion by 2020. Also a decline of 7.3% is expected in 2019.

Other semiconductor capital spending is expected to reach $ 34.1 billion in 2017 recording a growth of 1.8%.

“Spending momentum is more concentrated in 2017 mainly due to strong manufacturing demand in memory and leading-edge logic,” said Takashi Ogawa, research vice president at Gartner.

“The NAND flash shortage was more pronounced in the first quarter of 2017 than the previous forecast, leading to over 20 percent growth of etch and chemical vapor deposition (CVD) segments in 2017 with a strong capacity ramp-up for 3D NAND,” added Ogawa.

Gartner also said that spending on wafer fab equipment will follow a similar cycle with a peak in 2018. “While the most likely scenario will still keep positive growth in 2018, there is a concern that the growth will turn negative if the end-user demand in key electronics applications is weaker than expected,” said Ogawa.