Lithography back on track as dominant semiconductor equipment sector

NEW TRP{OLI, USA: After a plunge to 16 percent of the semiconductor equipment market in 2009, the lithography sector surged in 2010 to a 26.5 percent share of the global market, according to our report: The Global Market for Equipment and Materials for IC Manufacturing.

While the rest of the semiconductor front-end equipment grew on the order of 107 percent in 2010, our preliminary estimates based on anticipated Q4 shipments are that the lithography sector grew 165 percent to revenues close to $6 billion.Source: The Information Network, USA.

Irrational exuberance on the part of DRAM (and other) manufacturers in purchases of immersion DUV lithography tools was the key factor. Immersion 248nm tools cost $42 million each versus $27 million for dry 248nm and $5 million for 1-line equipment.

In our opinion, Samsung was the major culprit in the excessive purchases, and today there is a report the company will reduce capex 14 percent in 2011. We’ve stated some months ago that we anticipate pushouts in immersion tool shipments in Q4 2010.

The report notes that overall shipments of lithography tools will increase 87 percent in 2010, but immersion tool shipments will increase 148 percent.

Because of the exemplary performance by ASML, where they won the immersion war with Nikon, ASML will increase its share of the lithography market to 59.5 percent in 2010 on a unit basis, up from 44.7 percent in 2009. On a revenue basis, ASML will increase its share from 61.2 percent in 2009 to 77.8 percent in 2010. ASML’s share of the immersion DUV tool will settle in at an 88.9 percent share.