Expansion in Manufacturing Equipment Demand Driven by China’s Semiconductor Industry Policy and Next-Generation Process Investment

「In the semiconductor industry, investment in data centers remained firm against a backdrop of the expanding adoption of generative AI, and demand for AI logic semiconductors and high-bandwidth memory (HBM) drove the overall market. In addition, investment in general-purpose DRAM increased from the second half of the fiscal year, supported by tight supply and recovering prices as AI-related demand expanded. Meanwhile, polarization by application became more pronounced, with prolonged inventory adjustments and continued restraint in capital investment in automotive and industrial equipment applications.」

「In the semiconductor industry, investment in data centers remained firm against a backdrop of the expanding adoption of generative AI, and demand for AI logic semiconductors and high-bandwidth memory (HBM) drove the overall market. In addition, investment in general-purpose DRAM increased from the second half of the fiscal year, supported by tight supply and recovering prices as AI-related demand expanded. Meanwhile, polarization by application became more pronounced, with prolonged inventory adjustments and continued restraint in capital investment in automotive and industrial equipment applications.」

「In the semiconductor industry, some stagnation remains, including sluggish automotive demand due to slower growth in the EV market and a delayed recovery in legacy semiconductors. Meanwhile, demand from generative AI and data centers is driving the market, and the industry as a whole continues to maintain solid growth as investment in high-performance, low-power semiconductor technologies accelerates.」

「Under these conditions, our group increased revenue year on year by capturing demand in China, which is promoting semiconductor self-sufficiency, and Southeast Asia, where active investment continued against a backdrop of geopolitical risks.」

「In the semiconductor industry, investment in generative AI and in semiconductor self-sufficiency in China remained firm, but investment for consumer products has not yet fully recovered, despite a gradual improvement in utilization rates. Meanwhile, expectations for further medium- to long-term market expansion are growing, driven by increasing demand for generative AI semiconductors, the spread of PLP (panel-level packaging), and the development of the semiconductor industry in India.」

「In the semiconductor industry, the downturn in demand for semiconductors associated with weaker demand for consumer products such as PCs and smartphones has persisted. Meanwhile, demand for server investment, including ultra-wideband memory (HBM: High Bandwidth Memory), has remained strong as generative AI becomes more widespread, and continued investment is expected. In addition to continued aggressive investment related to generative AI in 2024, capital investment for consumer products such as PCs and smartphones, particularly memory semiconductors, is expected to recover, leading to expectations of further expansion in the semiconductor market.」

「Although sluggish demand for end products such as PCs and smartphones persisted in the semiconductor industry, stable demand for automotive and power semiconductors continued. In addition, investment in servers, including ultra-wideband memory (HBM: High Bandwidth Memory), increased as generative AI spread, and continued investment is expected.」

「In the semiconductor industry, inventory adjustments continued, particularly for memory semiconductors, due to sluggish demand for end products such as PCs and smartphones, while stable demand for automotive and power semiconductors continued.」

「Against this backdrop, demand for PCs and smartphones in the semiconductor industry and the semiconductor manufacturing equipment industry in which we operate remained stagnant due to the slowdown in the Chinese economy and weaker personal consumption, and investment plans, particularly for memory semiconductors, were postponed. However, investment to increase production of automotive and power semiconductors remained firm, and conditions remained resilient.」

「While capital investment showed signs of slowing due to declining demand for PCs and smartphones resulting from weaker personal consumption, capital investment in increasing production of automotive and power semiconductors for the expanding electric vehicle market remained firm. The semiconductor manufacturing equipment market in which we operate showed similar trends, while investment to shift to domestic production to diversify risk supported orders.」

「Although demand for PCs and smartphones stagnated due to declining demand for end products, robust demand continued, particularly for data centers and automotive applications. The semiconductor manufacturing equipment market in which we operate also remained brisk, supported by investment to increase production in response to expanding semiconductor demand. Semiconductor demand is expected to continue broadening as society becomes more digitalized and efforts continue toward achieving a decarbonized society, and high growth is expected to continue.」

「In the semiconductor industry, robust demand for semiconductors continued across a wide range of fields, including products related to the high-speed communications standard 5G, as well as PCs, automotive applications and consumer electronics. The semiconductor manufacturing equipment industry in which we operate also benefited from a strong market environment, supported by investment to expand production capacity to address the global semiconductor shortage, active investment in semiconductor self-sufficiency in China, and investment to review semiconductor supply chains from an economic security perspective.」

「In the semiconductor industry, robust demand for semiconductors continued across a wide range of fields, including products related to the high-speed communications standard 5G, such as smartphones, as well as PCs, data centers and consumer electronics. The semiconductor manufacturing equipment market in which we operate also remained brisk, as companies actively invested in increasing production to meet robust semiconductor demand and in semiconductor self-sufficiency in China.」

「In the semiconductor industry, robust demand for semiconductors continued across a wide range of product areas, including products related to the high-speed communications standard 5G, such as smartphones, as well as PCs, automotive applications and consumer electronics. The semiconductor manufacturing equipment market in which we operate also remained brisk, as companies actively invested in expanding production capacity to address the global semiconductor shortage and anticipated future demand growth, as well as in capital equipment to support semiconductor self-sufficiency in China.」

「The semiconductor manufacturing equipment market is expected to continue growing strongly, driven by expanding semiconductor demand associated with the spread of AI (artificial intelligence) and 5G and the shift toward EVs (electric vehicles), as well as moves by governments worldwide to rebuild semiconductor supply chains in response to concerns over geopolitical risks.」

「In the semiconductor industry, tight supply and demand for semiconductors, driven by increased demand for IT-related products as remote work and online classes expanded and by the full-scale adoption of the high-speed communications standard 5G, coincided with a sharp recovery in demand from the automotive and industrial machinery sectors, resulting in a global semiconductor shortage. In response, semiconductor manufacturers increased capital investment to strengthen their supply capabilities, and a strong market environment continued.」

「The semiconductor market remained strong, supported by continued robust demand for 5G-related products and notebook PCs and servers associated with the spread of teleworking and online classes, as well as increased demand for automotive semiconductors driven by the shift to EVs and further acceleration of semiconductor localization in China.」

「Although the semiconductor industry faces uncertainty over the outlook amid escalating US-China tensions, including tighter US export controls on Chinese companies and China's consideration of countermeasures, semiconductor demand remained firm, supported by increased investment related to 5G and growing server demand prompted by the spread of teleworking and online classes.」

「In the semiconductor industry, demand for data centers increased as teleworking spread, and active capital investment aimed at semiconductor localization in China continued. However, uncertainty about the outlook caused by concerns over prolonged economic stagnation from the spread of COVID-19 and the escalation of the US-China trade war led to delays in some capital investment plans and equipment installation schedules. Although weakness is visible in the current market, medium- to long-term market growth is still expected, driven by the full-scale expansion of investment related to 5G and the broader use of artificial intelligence (AI).」

「Although uncertainty caused by the US-China trade war remains, equipment utilization among customers, particularly in China and Taiwan, has improved as China accelerates semiconductor localization and demand for applications related to 5G, the next-generation communications standard, increases.」

「Although uncertainty over the outlook for the US-China trade war means that customers' appetite for capital investment remains weak, signs of recovery have begun to emerge in the previously sluggish semiconductor market, supported by strong demand for 5G base stations, signs that memory prices have bottomed out and positive capital investment activity at some companies.」

「In the semiconductor industry, earnings continued to deteriorate, particularly among major semiconductor manufacturers, owing partly to the continued decline in memory prices. In addition to the deepening US-China trade conflict, trade issues between Japan and South Korea created new concerns for the semiconductor market, making the outlook increasingly uncertain. Meanwhile, in anticipation of the practical deployment of 5G, the next-generation communications standard, the increase in IoT devices and the expanding use of AI, related companies remained positive toward capital investment, and semiconductor demand is expected to continue expanding over the medium to long term.」

「In the semiconductor industry, the market slumped substantially from the second half onward because of falling memory prices and slowing smartphone demand. Corporate sentiment deteriorated further as the US-China trade war dragged on, and the outlook for recovery remains uncertain.」

「The market environment has deteriorated substantially as the smartphones, memory and Chinese market segments that had driven the market slowed simultaneously, with capital investment in China plunging partly because of the impact of the US-China trade war.」

「In the semiconductor industry, memory demand, which had remained at high levels through the previous fiscal year, reached a plateau, and capital investment by memory manufacturers stagnated. In addition, the sharp decline in demand for semiconductors used in cryptocurrency applications led major foundries to lower their sales forecasts, and signs of a temporary slowdown emerged in current conditions.」

「In anticipation of the huge market for AI semiconductors capable of processing large volumes of data at high speed, development competition among major semiconductor manufacturers in growth markets is accelerating. Active research and development investment across industry boundaries is also continuing, including development partnerships between automakers and IT companies aimed at the spread of electric vehicles, connected cars and the practical application of autonomous driving technologies.」

「In the semiconductor industry, major semiconductor manufacturers and OSAT companies are actively investing in new factories and other facilities in response to high semiconductor demand known as the supercycle, intensifying competition to capture demand.」

「Semiconductor manufacturers are actively investing in equipment to miniaturize and enhance the functionality of semiconductor chips. Industry structures are also expected to change, including through major IDMs strengthening their contract manufacturing businesses.」

「In the semiconductor industry, large-scale capital investment in miniaturization and 3D integration is being actively undertaken, and major semiconductor companies are becoming increasingly prominent.」

「China's national strategy for fostering the semiconductor industry continues to drive the Chinese market, while overseas manufacturers are accelerating their expansion into China. Semiconductor investment of ¥5 trillion is planned by 2020, more than twice the level of the previous five years, and 16 front-end factories are planned for construction or expansion.」

「China's national strategy for fostering the semiconductor industry continues to drive the market. In addition, major semiconductor companies have begun strategic development and capital investment for next-generation processes, and investment in semiconductor manufacturing equipment is expected to accelerate.」