Friday, December 17, 2004
The semiconductor equipment market is expected to rise 53.3 percent in 2004 compared with 2003 but will drop 9.6 percent in 2005 and 5.0 percent in 2006, according to a market research firm.
The company did not quantify the size of the market. "Late 2003 and early 2006 forecasts of hyper growth in the equipment market have lead to excess capacity, excess inventory, layoffs, lower profits, pushouts, and cancellations," said Robert Castellano, president of The Information Network, in a statement.
"While the forecasts may have ironically been correct, clearly not all that equipment was needed in 2004, and the overshoot has served to illustrate that the cyclical nature of the semiconductor industry remains despite lessons learned in 2001 and best efforts in inventory control." Excess chip inventory in now approaching $2 billion, and even foundry giants such as TSMC and UMC are seeing revenues drop for the past two months. Warnings and layoffs abound in the industry, said Castellano.
By: DocMemory
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