Semiconductor spend to rise

Calcutta, Oct. 25: Capital spending on semiconductors is set to touch $64.5 billion this year globally, an increase of 11.4 per cent from $57.8 billion last year, according to research firm Gartner.

Spend on equipment manufacturing semiconductors is also projected to rise 17.1 per cent in the current year, Gartner said.

Semiconductors are used in devices such as tablets, PCs and smartphones.

“While capital spending outperformed equipment spending in 2013, the reverse will hold true for 2014. Total capital spending will grow 11.4 per cent in 2014 compared with 7.1 per cent in our prior forecast. This is because Samsung increased its spending plans to $14 billion,” said David Christensen, senior research analyst at Gartner.

In equipment manufacturing, Gartner estimates spending to grow to $43.6 billion in 2015 from $39.2 billion this year before declining 7.3 per cent in 2016.

Semiconductor capital spending will grow from $64.5 billion in 2014 to $70.1 billion in 2015, followed by a slump of about 4.1 per cent in 2016.

Spending by foundries, or those who manufacture products for other semiconductor companies, is expected to increase 4.5 per cent compared with a decrease of 0.3 per cent in total spending.

However, the long-term outlook for total foundry spending is flat because of the softening in the mobile market.

The outlook for capital expenditure on memory remains strong for 2014 with a 40 per cent increase forecast for the year compared with a 25 per cent rise in the previous quarter’s estimates.

According to Gartner, memory manufacturers enjoy a strong pricing environment, setting the stage for renewed spending growth.