Combined semiconductor industry capital spending in 2021 and 2022 forecast to reach US$344.3 billion
KUCHING: The combined semiconductor industry capital spending in 2021 and 2022 has been forecast to reach US$344.3 billion, amid strong fabrication facility utilisation rates and the expectations of continued high demand.
According to the research arm of MIDF Amanah Investment Bank Bhd (MIDF Research), demands accelerated by the outbreak of Covid-19 has compelled most fabrication facility utilisation rates to run well above 90 per cent with many of the semiconductor foundries operating at 100 per cent utilisation.
“With such strong utilisation rates and the expectations of continued high demand, the combined semiconductor industry capital spending in 2021 and 2022 is forecast to reach US$344.3 billion,” MIDF Research said.
The research arm noted in its technology sector update that there are 13 companies that will likely increase their capital outlays by more than or equal to 40 per cent this year.
“These 13 companies spent US$60.6 billion last year, which was up 62 per cent year on year (y-o-y), and are forecast to spend US$91.8 billion this year, or an increase of 52 per cent y-o-y.
“To note, the big three memory suppliers (i.e., Samsung, SK Hynix, and Micron) are not on the list while the top three pureplay foundries (TSMC, UMC, and GlobalFoundries) are included.
“Four of the top five leading analog integrated circuit (IC) suppliers (TI, Analog Devices, Infineon, and ST) are scheduled to significantly ramp up spending in 2022.”
The research arm also noted that over the next few years, many companies’ outlays are likely to revert to a capital spending as a per cent of sales ratio of somewhere near prepandemic levels.