Semiconductor Equipment - Berenberg Bank

Semiconductor Equipment
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The amount of capex from these three types of chip-makers will depend on their
end-market demand and technology roadmap. We estimate the aggregate capex will
remain flattish between 2013 and 2015. We expect 450mm migration-related capex
to start increasing in 2016 from logic/foundry chip-makers, which will lead a 10%
growth in overall capex (see Figure 8).
Figure 8: Total capex to be flat in 2014/2015 and boosted in 2016 by 450mm spending
$mn
80,000
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
Source: Gartner data, Berenberg estimates
Memory – NAND spending will normalise from now
NAND capex grew aggressively from 2000 to 2007, outgrowing total
semiconductor capex over the period. During this time, NAND bit shipments grew
by c190%, fuelled by the increase of portable applications, such as digital cameras
and personal digit assistants in 2000, followed by growth of Apple’s Nano/Shuffle
products after launch in 2003. Since this period of rapid expansion, the NAND
spending cycle tended to follow the spending cycle of total semiconductor capex
(see Figure 9).
Figure 9: NAND capex versus total semi capex growth
% growth
200%
150%
100%
50%
0%
-50%
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E 2015E 2016E
Foundry&logic IDM Memory
-100%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
NAND Capex
Total Capex
Source: Gartner data
From the second half of 2011, the NAND industry struggled due to oversupply
after its significant expansion phase; this was largely the result of softer demand in
USB storage, fewer bundled cards with smartphones and channel inventory
clearing. As a result, the NAND price fell by 42% in 2012 and 33% in 2011. In July
2012, Toshiba cut its utilisation rate by 30% (6-8% aggregate NAND capacity), and
indeed all NAND vendors have become more conservative in adding new capacity.
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