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Capex of Korean Semiconductor Companies Forecast to Drop Next Year
Leading the Global Downturn
Capex of Korean Semiconductor Companies Forecast to Drop Next Year
  • By Jung Suk-yee
  • December 21, 2018, 09:17
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The global fab equipment spending is likely to total US$55.78 billion next year, down 7.8% from this year.

With falling memory chip prices signaling a downturn in the global semiconductor industry, Semiconductor Equipment and Materials International (SEMI) has adjusted its global capital expenditure estimate for next year to a much lower level. In particular, SEMI predicts South Korean semiconductor companies’ capital expenditure to decrease 34.7% compared to this year.

The industry association said in its recent report that the global fab equipment spending is likely to total US$55.78 billion next year, down 7.8% from this year. In September this year, it estimated next year’s spending at US$67.5 billion. In addition, its year-on-year growth forecast for this year has been adjusted from 14% to 9.6%.
 

According to the latest report, memory chip manufacturers’ capital expenditure is estimated to fall 19%, instead of increasing 3%, next year. The estimated rate of decrease is 23% in the DRAM sector and 13% in the NAND flash sector.

South Korean semiconductor companies’ capital expenditure is estimated to reach US$12.087 billion next year with a year-on-year decrease of 34.7%, leading the global downturn. That of Chinese companies, which increased 84.3% this year, is forecast to fall 2% to US$11.957 billion. Those of Taiwanese companies and Micron Technology, meanwhile, are predicted to increase 24.2% to US$11.438 billion and 28% to US$10.5 billion, respectively.
 

“Samsung Electronics is likely to reduce its investment in the P1 and P2 facilities in Pyeongtaek and S3 in Hwaseong and SK Hynix is predicted to slow down the pace of DRAM process expansion,” SEMI explained, adding, “GlobalFoundries is reconsidering its plan regarding new facilities in Chengdu, China and SMIC and UMC are delaying their investment as well.”