Global semiconductor equipment five brewing big changes in 2024

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The wave of general artificial intelligence has given rise to the demand for high-performance computing chips, as the chip manufacturing equipment, EUV lithography is of great concern, ASML's importance is more and more prominent, and in this wave, the pattern of the semiconductor equipment market is also quietly changing.

In the first half of 2023, the global semiconductor equipment vendors market size has been adjusted, and the statistics of CINNO Research show that In the third quarter of 2023, ASML's revenue continued to maintain its position as the world's top equipment vendor, surpassing Applied Materials, which has long topped the list in the past.

 

   The first signs of change  　 

For a long time, the semiconductor equipment market has shown the situation of "five strong".

CINNO Research statistics show that in the three years from 2020 to 2022, the global listed companies in the semiconductor equipment business revenue, the U.S. company application materials are stable at the top of the list, followed by the Dutch company ASML, the U.S. company PanLin, the Japanese company Tokyo Electron and the U.S. company Kelei, perennial "dominant list"! "Semiconductor equipment market size of the top five.

As the key support link in the industry chain, semiconductor equipment is used in the whole chain from wafer manufacturing to packaging and testing, so different semiconductor equipment manufacturers have their own focus on the main direction. Pan-Lin Group and Tokyo Electron have a leading position in the field of thin film deposition and etching; Kelei occupies half of the market in the field of semiconductor forehearth inspection equipment; ASML focuses on the research and development and manufacturing of photolithography machines, and is the supplier of high-numerical value aperture EUV (Extreme Ultraviolet) photolithography machines; and Applied Materials has divided into many different ways, with a wide range of process combinations, and its product line is more comprehensive, covering dozens of semiconductor manufacturing equipment, so it has been able to hold a long-term position in the semiconductor manufacturing market for a long time. Equipment, and therefore can sit for a long time in the semiconductor equipment supplier of the throne.

However, behind the seemingly stable market map, the competition between vendors is surging, brewing an invisible change.

In the first half of 2023, the global semiconductor equipment vendors' market size was adjusted, ASML jumped to the top of the list with revenue of more than $14.8 billion, followed by Applied Materials with $12.4 billion, Tokyo Electron also overtook Pan-Lin to take the third place, and Coretronic remained in the fifth place.

ASML's lead was further emphasized in Q3 2023, when CINNO Research found that the semiconductor businesses of the top five equipment vendors accounted for 88% of the Top 10's combined revenue with a total of more than $22 billion. Among them, ASML's third-quarter revenue of about $7.1 billion was not only the top five vendors to achieve year-on-year revenue growth for the quarter, but also accounted for 32% of the total revenue of the top five vendors.

"Changes in demand in the global semiconductor market directly affected ASML's performance." The industry said in an interview with China Electronic News, "With the development of AI, 5G, IoT and other technologies, the demand for high-performance chips continues to grow, which have supported ASML's business growth."

Semiconductor industry analyst Robert Castellano believes that ASML will overtake Applied Materials as a supplier in the WFE (wafer front end) semiconductor equipment segment in 2023.

 

  AI becomes a new track for overtaking  

Analyst Omdia's statistics show that NVIDIA sold a total of 500,000 AI chips in the third quarter, including A100 and H100, of which, A100 and H100 use 7nm and 4nm processes, respectively; In addition, as a foundry giant, TSMC publicly disclosed data show that in the first three quarters of this year, the revenue of the 5nm process in the total revenue accounted for all of them, respectively, was 31%, 30% and 37%, followed by 7nm process, accounting for 20%, 23% and 16%, respectively, 7nm and the following advanced process has always been TSMC's revenue mainstay.

It is worth mentioning that advanced processes cannot be separated from advanced lithography equipment. At present, the extreme ultraviolet (EUV) is the world's lithography technology, but also 7nm process chip key equipment. ASML as the extreme ultraviolet (EUV) lithography supplier, naturally become the wave of AI deserves the "wave runner", taking into account the complexity of high-end lithography technology and research and development costs, short-term competitors are difficult to catch up with ASML's technological advantage. ASML 2023 third-quarter financial data show that the amount of new orders in the third quarter of 2.6 billion euros, of which 500 million euros from the EUV lithography orders.

In addition to arithmetic chips, storage chip manufacturers have also aimed at advanced process technology. Following Samsung took the lead in the use of EUV lithography mass production of 14nm DRAM chips, SK Hynix, Micron also announced that it will produce EUV-based DRAM, EUV is increasingly becoming the focus of the storage giants.

Affected by the terminal market weakness, Tokyo Electron and Pan-Lin revenue in the first half of the year have a certain degree of decline, but compared to the United States domestic semiconductor manufacturers, Japan by geopolitical impact is smaller, or will lead to Tokyo Electron and Pan-Lin Group revenue fluctuations for a short period of time.

　

  The market pattern is not determined  

Although ASML all the way up, temporarily ranked in the leading semiconductor equipment revenue list, but this is not a foregone conclusion.

On the one hand, ASML lithography on the Chinese market dependence gradually deepened. 2023 ASML three consecutive quarterly earnings data show that the Chinese mainland market for ASML's revenue contribution rate gradually soared from 8% in the quarter of 2023 to 24% in the second quarter, the third quarter is a sudden increase to 46%, the quarter ASML's total sales of 6.7 billion euros, of which about 3.1 billion euros from the Mainland China, a new high.

In this regard, ASML financial officer Roger Dassen explained that: "Most of the shipments in mainland China this quarter are from 2022 and before the order." However, a large number of demand in the short term to focus on the release of the performance surge, is not replicable. In addition, subject to geopolitics, ASML's operation can not fully follow the business logic, lithography exports to China will be subject to multiple restrictions.