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SEMI: Sept. Semiconductor Equipment B/B Ratio Stands Sub-1

Oct 31, 2014 | By Ken Liu

According to market consultant SEMI of the United States, the book-to-bill (B/B) ratio for North American semiconductor-equipment industry retreated to 0.94% in September (three-month average basis) following 11 months of expansion marked by the above-1 ratio.

While order activity moderated, equipment spending this year is expected to be robust and remain on pace for double-digit year-over-year growth, said Denny McGuirk, president and CEO of SEMI.

A book-to-bill of 0.94 means that US$94 worth of orders were received for every US$100 of product billed for the month.

In September, the three-month average of worldwide bookings was US$1.17 billion, with the three-month average of worldwide billings standing at US$1.25 billion. The billings figure represented a 12.9% decrease from US$1.35 billion posted in August 2014, and an 18.1% increase from US$992.8 million in the same period of last year.

The billings represented a 3.3% decline from US$1.29 billion registered in August 2014 and a 22.5% growth from US$1.02 billion in September 2013.

According to SEMI, although the September bookings and billings figures represent a drop due to seasonal factor, the figures still represent the 13th month of annual growth.

Regardless of the September's sub-1 ratio, outlook for the equipment market remains bright in 2015 for the multibillion US-dollar capital spending planned by Taiwan Semiconductor Manufacturing Co. (TSMC), Intel Corp. and Samsung Electronics Co., Ltd.

Gartner, another market consultant, estimates capital expenditure on semiconductor equipment to increase 8.8% to US$70.1 billion worldwide next year from this year's projected US$64.5 billion, an increase of 11.4% from 2013.

For the silicon foundry sector, Gartner estimates the capital expenditure to rise 10.7% to US$35.5 billion next year from 2014's projected US$32.1 billion, a surge of 17.6% from the year earlier.

Garner says that although the expenditure by silicon foundries will still exceed that by integrated device manufacturers (IDMs) this year, the growth will flatten in the longer term when the market for mobile devices saturates.

Gartner forecasts that excessive demand for DRAM chips will continue into 2015 and oversupply will not return until 2016, when  DRAM supply will soar 36% in terms of bytes due to brisk expansions at Samsung and SK Hynix Semiconductor Inc. (KL)


SEMI B/B ratio report for Apr.-Sept. 2014
                     
(unit: US$ million)


Billings
(3-mo. avg)
Bookings
(3-mo. avg)
Book-to-Bill
April 2014
$1,403.2
$1,443.0
1.03
May 2014
$1,407.8
$1,407.0
1.00
June 2014
$1,327.5
$1,455.0
1.10
July 2014
$1,319.1
$1,417.1
1.07
August 2014 (final)
$1,293.4
$1,346.1
1.04
September 2014 (prelim)
$1,250.4
$1,172.8
0.94
Source: SEMI, October 2014


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