Samsung is forecast to be the top spender of semiconductor capital expenditures in 2014, followed closely by Intel, according to the latest bulletin from IC Insights. Rounding out the top five spenders are TSMC, GlobalFoundries, and SK Hynix. The research reveals that the top three companies will account for 52 percent of the total semiconductor capex in 2014, although it is a slight decrease from last year’s 55.5 percent share.
The top ten spenders are forecast to increase capex spending by 10 percent in 2014, after flat spending last year, according to IC Insights. Nine of the top 10 semiconductor industry capital spenders are expected to increase their semiconductor capex in 2014, compared to only four increasing their spending levels last year. Among the top ten, six are expected to spend at least $3.0 billion in 2014, and nine will spend more than $1.0 billion.
In contrast, capex spending by “other” suppliers are expected to grow at a three percent rate in 2014. However, this is an improvement from the 15 percent drop in 2013, according to IC Insights. These suppliers will either increase their spending at a lower rate or decrease their spending at a higher rate in the long term, compared to the top 10, as they move to fables or “fab-lite” business models for IC production, according to the report.
While Samsung, Intel and TSMC are expected to have the largest budgets this year, SanDisk and Micron are forecast to have the biggest increases in spending. Samsung and Intel are both forecast to spend at least $11.0 billion in 2014 followed by TSMC, spending nearly $10.0 billion this year, according to IC Insights.
SanDisk is expected to have the largest percentage increase in capital spending (86%) among the top 10, after cutting its capital spending by 12 percent in 2013 and 28 percent in 2012. Despite the large increase to expand production of advanced 3D NAND flash memory with its manufacturing partner Toshiba, IC Insights doesn’t expect the increased spending to result in a big boost to its NAND flash capacity levels. The combined capex spending increase of Toshiba and SanDisk, due to their joint venture partnership to build flash memory, is forecast to reach $1.06 billion in 2014.
Other big spenders include Micron and pure-play foundry GlobalFoundries. The report reveals that Micron is expected to increase its spending by 58 percent, reaching $1.12 billion in 2014. GlobalFoundries also is expected to increase its semiconductor capital spending by $1.0 billion this year, according to analysts, while SK Hynix increases its spending by 18 percent in 2014.
Samsung is forecast to spend $35.3 billion from 2012 to 2014, with about 60 percent of this spend targeting memory production. Intel follows with a forecast of $32.6 billion over the same time period. “These huge levels of spending are enough for each company to construct and equip eight or nine $4.0 billion leading-edge 300mm wafer fabs,” according to IC Insights.
The March Update to The 2014 McClean Report, published by IC Insights, will provide a forecast ranking of the top 25 semiconductor capital spenders for 2014.