EB SECURITIES: Global wafer factory capacity to expand significantly, semiconductor equipment industry's prosperity is on the rise.
Global wafer fab capacity is expanding significantly, and equipment spending in wafer fabs continues to rise. The leading companies in the global semiconductor front-end equipment sector are expected to see revenue growth in the future, while back-end equipment is expected to gradually recover.
EB SECURITIES released a research report indicating that global wafer fab capacity is significantly expanding, and wafer fab equipment spending continues to rise. Leading companies in the global semiconductor front-end equipment are expected to see revenue growth in the future, while back-end equipment is expected to gradually recover.
According to SEMI's forecast, spending on 12-inch wafer fab equipment will continue to climb from 2023 to 2027, with a CAGR of 9%; benefiting from mature process investments, revenue is expected to increase by 4% in 2023, by 20% in 2025 due to High NA EUV (high numerical aperture extreme ultraviolet lithography) and HBM, and by 12% in 2026 due to GAAFET technology. Global 300mm wafer fab equipment investment is projected to increase by 20% to $116.5 billion in 2025, rise by 12% to $130.5 billion in 2026, and reach a historical high in 2027. In 2024, it is expected that 60 new wafer fabs will be added. Among them, 23 wafer fabs have started construction, with 6 in mainland China accounting for 26.09%; and 37 new wafer fabs have been put into operation, with 19 in mainland China accounting for 51.35%.
EB SECURITIES stated that revenue growth is expected for the leading companies in the global semiconductor front-end equipment. The combined revenue of the five front-end equipment companies (ASML, AMAT, KLA, LAM, TEL) in Q2 2024 amounted to $23.502 billion, an increase of 5.75% from the previous quarter; the net profit reached $6.244 billion, an increase of 11.42%. According to Bloomberg's consensus expectations, the combined revenue of the five front-end equipment companies is forecasted to increase to $25.406 billion in Q3 2024, a growth of 8.10% compared to the previous quarter; net profit is expected to increase to $6.626 billion, a growth of 6.12%.
Back-end equipment is expected to gradually recover. The combined revenue of the two leading semiconductor test equipment companies (Teradyne, Advantest) in Q2 2024 amounted to $1.62 billion, an increase of 7.04% from the previous quarter; with Teradyne's revenue at $730 million and Advantest's revenue at $890 million. The net profit reached $295 million, with Teradyne at $142 million and Advantest at $153 million. According to Bloomberg's consensus expectations, the combined revenue of the two test equipment companies is forecasted to be $1.725 billion in Q3 2024, with a combined net profit of $307 million.
Risk Warnings: Risks include lower-than-expected semiconductor demand, macroeconomic performance falling short of expectations, and intensified industry competition.
This article is sourced from a research report released by EB SECURITIES and the author is analyst Liu Kai.
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