Semiconductor Manufacturing Equipment Market Analysis and Opportunities by 2027

[Research Report] The semiconductor manufacturing equipment market accounted to US$ 62.10 Bn in 2018 and is expected to grow at a CAGR of 5.2% during the forecast period 2019 - 2027, to account to US$ 101.58 Bn by 2027. 

Analyst Perspective:

The semiconductor manufacturing equipment market plays a critical role in supporting the production of semiconductors, including integrated circuits (ICs) manufacturing companies, which are the backbone of modern electronic devices. This market encompasses various players, including semiconductor equipment manufacturers, capital companies, tool manufacturers, metrology companies, and used semiconductor equipment suppliers. Semiconductor equipment manufacturers are at the forefront of developing cutting-edge equipment used in semiconductor manufacturing. These companies design and produce tools that enable various stages of semiconductor fabrication, such as lithography, etching, deposition, and wafer testing. Their innovations drive the advancements in semiconductor technology and enable the production of smaller, faster, and more powerful chips. Semiconductor capital companies play a vital role by providing financial resources and investments to semiconductor machinery manufacturers and equipment suppliers. These companies recognize the importance of the semiconductor industry and its growth potential, and they actively contribute to market development. Semiconductor tool manufacturers are specialized firms that produce specific tools and equipment used in semiconductor manufacturing. These tools include wafer processing systems, metrology equipment, packaging equipment, and testing solutions. They work closely with semiconductor manufacturers to meet their specific requirements and ensure the quality and efficiency of the manufacturing process.

Semiconductor metrology companies are responsible for providing advanced measurement and inspection solutions for semiconductor manufacturers. Their tools and systems enable precise measurement of critical parameters, ensuring the quality and reliability of the manufactured chips. Metrology is crucial in maintaining high yield rates and improving overall process control in semiconductor manufacturing.

Market Overview:

Semiconductor manufacturing equipment is the processing machinery utilized to form a variety of electrical and integrated circuits (ICs). The growth of telephony, computers, biotechnology, military technology, aviation, renewable energy, and other fields is made possible by semiconductors, which are a crucial part of electronic equipment. Circuits, memory chips, IC chips, and a wide range of other goods are all made using equipment for the fabrication of semiconductors.

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Published Report - Semiconductor Manufacturing Equipment Market: Strategic Insights

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Market Driver:

Increasing Consumption of Consumer Electronics to Drive Growth of Semiconductor Manufacturing Equipment Market

The increasing consumption of consumer electronics is a significant driver for the growth of the semiconductor manufacturing equipment market. Consumer electronics, including smartphones, tablets, laptops, smart appliances, and wearable devices, have become integral to people's lives, driving the demand for advanced semiconductor chips. As consumer electronics evolve with new features, higher performance, and increased connectivity, semiconductor manufacturers face the challenge of meeting these demands. This necessitates adopting advanced manufacturing processes and equipment to produce smaller, more powerful, and energy-efficient chips. Semiconductor equipment manufacturers play a crucial role in addressing this demand. They develop and provide innovative equipment and tools that enable the production of these advanced chips. For example, lithography systems, which use optical or EUV (Extreme Ultraviolet) technology, are utilized for patterning intricate circuitry on wafers. Etching equipment helps in precise material removal, while deposition tools enable the controlled deposition of thin films on the wafer surfaces. These equipment advancements enable semiconductor manufacturers to fabricate smaller transistors and increase chip density, resulting in higher-performance devices.

Moreover, consumer electronics manufacturers increasingly require quick time-to-market for their products. This creates a need for efficient and high-throughput manufacturing processes. Semiconductor tool manufacturers respond to this demand by developing advanced wafer processing systems that improve productivity and reduce cycle times. Additionally, metrology equipment and testing solutions are essential for ensuring the chips' quality and reliability, meeting consumer electronics manufacturers' stringent requirements. The growth in the consumption of consumer electronics also contributes to the need for semiconductor capital companies to invest in the expansion and enhancement of semiconductor manufacturing facilities. This investment enables semiconductor manufacturers to upgrade their equipment and increase production capacity to keep pace with the growing demand.

Segmental Analysis:

Based on equipment type, the semiconductor manufacturing equipment market is segmented into:

1. Wafer Manufacturing Equipment
2. Assembly & Packaging Equipment
3. Test Equipment
4. Others

The wafer manufacturing equipment segment held the largest share of the market in 2018, whereas the test equipment segment is anticipated to register the highest CAGR in the market during the forecast period. The wafer manufacturing equipment segment is the semiconductor manufacturing equipment market's largest and most significant component. It encompasses various processes and tools essential for fabricating wafers, the foundational element of chip production by the chip manufacturing equipment companies. Advanced lithography systems, etching and deposition tools, wafer inspection and metrology solutions are key factors contributing to the segment's dominance. The demand for smaller and more powerful chips, efficient production capabilities, and stringent quality control requirements in the consumer electronics industry are propelling the growth of this segment. Overall, the wafer manufacturing equipment segment holds a crucial position in meeting the evolving needs of the semiconductor industry.

Regional Analysis:

The Asia Pacific semiconductor manufacturing equipment market was valued at US$ 46.44 billion in 2018 and is projected to reach US$ 79.04 billion by 2027; it is expected to grow at a CAGR of 5.7% during the forecast period. The Asia Pacific region has emerged as the dominant semiconductor manufacturing equipment market, exhibiting significant growth and capturing a substantial share. This region's dominance can be attributed to several factors contributing to its strong position in the industry. The Asia Pacific region has some of the largest chip manufacturers globally. These companies, often called "biggest chip manufacturers," drive the demand for semiconductor manufacturing equipment. Their large-scale production facilities require advanced equipment and technologies to meet the growing needs of various industries, including consumer electronics, automotive, and telecommunications. The region has witnessed rapid growth in the consumption of consumer electronics. With a rising population and increasing disposable incomes, countries in the Asia Pacific region have become major markets for smartphones, tablets, laptops, and other electronic devices. This surge in demand for consumer electronics directly translates into increased demand for semiconductor chips, thereby driving the need for semiconductor manufacturing equipment.

Moreover, the presence of leading semiconductor equipment manufacturers and suppliers in the Asia Pacific further strengthens its dominance. These companies, specializing in semiconductor equipment manufacturing and providing advanced solutions, have established strong footholds in the market. Their expertise, technological advancements, and strategic collaborations with chip manufacturers and other stakeholders have contributed to the region's growth. Furthermore, the Asia Pacific region benefits from favorable government policies and initiatives to promote semiconductor manufacturing and attract investments. Governments in countries like China, South Korea, Taiwan, and Singapore have implemented various incentives, tax benefits, and infrastructure development programs to support the semiconductor industry's growth. These initiatives have attracted major semiconductor manufacturers and encouraged the establishment of semiconductor equipment manufacturing facilities in the region. The Asia Pacific region also offers a skilled workforce and robust supply chain ecosystem. It has a large pool of talented engineers and technicians with the necessary expertise to operate and maintain advanced semiconductor manufacturing equipment. The region's well-developed supply chain network ensures a steady flow of raw materials, components, and equipment for semiconductor manufacturing processes.

North America holds a significant position in the semiconductor manufacturing equipment market, leveraging its technological advancements, strong industry presence, and innovative capabilities. The region's robust semiconductor ecosystem and key market players contribute to its notable standing. The presence of prominent semiconductor equipment manufacturers in North America drives the region's success. These manufacturers specialize in designing, developing, and producing cutting-edge equipment used in semiconductor manufacturing processes. They continuously strive to innovate and meet the market's demands, offering advanced solutions such as lithography systems, wafer fabrication tools, and metrology equipment.

Moreover, North America is home to some of the biggest chip manufacturers globally. These companies lead the market in semiconductor production and drive the demand for manufacturing equipment. Their large-scale operations require state-of-the-art equipment to ensure high-quality and high-volume chip production. The region's emphasis on research and development further strengthens its semiconductor manufacturing equipment market position. North America semiconductor manufacturing equipment market boasts renowned research institutions and universities that actively contribute to technological advancements and innovations in semiconductor manufacturing. This collaborative ecosystem fosters the development of next-generation equipment and processes. Furthermore, the region's focus on advanced manufacturing technologies, such as 5G, artificial intelligence (AI), and the Internet of Things (IoT), drives the demand for sophisticated semiconductor chips. To meet this demand, semiconductor manufacturers in North America invest in advanced equipment that enables the production of chips optimized for these emerging technologies. Additionally, North America's strong presence in the consumer electronics market significantly impacts the demand for semiconductor manufacturing equipment. The region is a major consumer of smartphones, tablets, laptops, and other electronic devices, leading to a continuous need for advanced chips. Semiconductor manufacturers in North America rely on cutting-edge equipment to meet the growing demands of the consumer electronics industry. North American governments provide incentives, grants, and favorable policies to encourage investment and innovation in the semiconductor industry. These measures further strengthen the region's position and attract industry players and investments.

Key Player Analysis:

The semiconductor manufacturing equipment market analysis consists of the players such as Advantest Corporation, Applied Materials, Inc., ASML Holding N.V., Hitachi High-Technologies Corporation, KLA Corporation, Lam Research Corporation, Rudolph Technologies, Inc., Screen Holdings Co., Ltd., Teradyne Inc., and Tokyo Electron Ltd. Among the players in the semiconductor manufacturing equipment ASML Holding N.V. and Rudolph Technologies, Inc. are the top two players owing to the diversified product portfolio offered.

Semiconductor Manufacturing Equipment

Published Report - Semiconductor Manufacturing Equipment Market Regional Insights

The regional trends and factors influencing the Published Report - Semiconductor Manufacturing Equipment Market throughout the forecast period have been thoroughly explained by the analysts at Insight Partners. This section also discusses Published Report - Semiconductor Manufacturing Equipment Market segments and geography across North America, Europe, Asia Pacific, Middle East and Africa, and South and Central America.

Published Report - Semiconductor Manufacturing Equipment Market Report Scope

Published Report - Semiconductor Manufacturing Equipment Market Players Density: Understanding Its Impact on Business Dynamics

The Published Report - Semiconductor Manufacturing Equipment Market is growing rapidly, driven by increasing end-user demand due to factors such as evolving consumer preferences, technological advancements, and greater awareness of the product's benefits. As demand rises, businesses are expanding their offerings, innovating to meet consumer needs, and capitalizing on emerging trends, which further fuels market growth.

Market players density refers to the distribution of firms or companies operating within a particular market or industry. It indicates how many competitors (market players) are present in a given market space relative to its size or total market value.

Major Companies operating in the Published Report - Semiconductor Manufacturing Equipment Market are:

1. Advantest Corporation
2. Applied Materials, Inc.
3. ASML Holding N.V.
4. Hitachi High-Technologies Corporation
5. KLA Corporation

Disclaimer: The companies listed above are not ranked in any particular order.

Recent Developments:

Inorganic and organic strategies such as mergers and acquisitions are highly adopted by companies in the semiconductor manufacturing equipment market. A few recent key market developments are listed below: 

• In October 2022, Applied Materials, Inc. worked with BE Semiconductor Industries N.V., a semiconductor manufacturing business. The combined businesses would develop a solution for die-based hybrid bonding, a chip-to-chip interconnect technology that allows subsystem designs and heterogeneous chips for 5G, AI, and high-performance computing applications. Furthermore, this would speed heterogeneous integration technologies and expand the types of equipment available.
• In June 2022, ASML and Mad Science will collaborate to establish a new technology education program (link in Dutch). The ASML Junior Academy program's purpose is to provide technology education to all 271 primary schools in the Brainport Eindhoven region.