The Week In Review: Manufacturing

Geeks are hip; EUV unknowns; charitable fun run; China’s IC policy.

popularity

The profile of a “tech geek” is typically a male. The label itself has transitioned from a negative to a positive connotation, according to new data from Crucial.com. In fact, almost half of women (45%) identified tech entrepreneurs as the most desirable potential spouse, compared to only 5% of women who would prefer a football player for a spouse. More than one in three women want a significant other who is tech savvy (38%).

What’s the latest with EUV? ASML has achieved its 80 Watt target with the EUV power source. It has also demonstrated 100 Watts with the source. On the downside, the uptime only averages 15%. So in 2015, ASML is focusing on the uptime issues. “But as a reminder, we have met the 500 wafer per day target that our customers set for us in 2014,” said Peter Wennink, president and CEO of ASML, during the company’s conference call to discuss its financial results. (This was transcribed on the Seeking Alpha Web site). “Our 2015 productivity target remains at 1,000 wafers per day. And importantly for our customers and for our EUV program we received the first two orders for our fourth generation NXE:3350 EUV tools, the first of which is planned for shipment in the middle of this year.”

Regarding the NXE:3350, Wolfgang Nickl, CFO of ASML, added: “It is highly likely that the demonstration of all key performance metrics will not be confirmed until 2016. The accounting rules under these circumstances are not allowing us to recognize any revenue until all performance metrics are met. Hence we do not expect to recognize revenue on the two TSMC NXC:3350s in 2015.” (This was also transcribed on the Seeking Alpha Web site.)

Lam Research, the Silicon Valley Leadership Group Foundation and others have teamed up to sponsor the Lam Research Heart & Soles 5K event. The fun run, which will take place on Feb. 7, is dedicated to help children make better food choices by moving salad bars into participating local schools.

In June 2014, the State Council of China issued the “National Guideline for the Development and Promotion of the IC Industry,” to support the domestic semiconductor industry. SEMI attempts to answer this question–Will the new policy in China trigger big changes?

At the recent Semicon Japan trade show, panelists shared their perspectives on industry growth and the impact of the internet of things (IoT).

SEMI’s public policy team has been paying close attention to four important trade issues for the industry. What are they?

Ford is opening an R&D center in Palo Alto to accelerate its development in connectivity, mobility, autonomous vehicles and big data.

AMD posted lackluster results in the quarter. The real question is becoming apparent—Is AMD a takeover target? Commenting on the quarter in a research note, Hans Mosesmann, an analyst from Raymond James, said: “Yet another reset for AMD as new CEO Lisa Su seeks to stabilize the channel (PC processors and graphics). AMD has proven resilient in terms of balance sheet management (cash and debt profile) and executing well with game console customers. While the jury will be out for the next 1-2 quarters regarding this transition, we believe AMD’s product and technology assets make the company a valuable target in an environment of consolidation. We estimate the GPU assets alone can be reasonably valued at $2 billion based on industry M&A multiples of 2-3x sales, in line with AMD’s current market cap.”

Samsung Electronics and Apple remained the top semiconductor buyers in 2014, representing with a combined semiconductor demand of 17%, according to Gartner. Samsung Electronics and Apple together consumed $57.9 billion of semiconductors in 2014, an increase of $3.9 billion from 2013.

Despite strong growth of 12.9% in 2014, worldwide semiconductor capital spending is projected to only grow 0.8% in 2015, to $65.7 billion, according to Gartner. Capital equipment spending will increase by 5.6% in 2015, down from 11.3% in the third quarter 2014 forecast, as the largest spenders adopt conservative investment strategies.

The ATE industry grew by 20% in 2014. That was driven by booming demand for test in the mobile-based application processor space. Not long ago, Pacific Crest Securities projected that the ATE market would grow by 10% in 2015. But the firm recently lowered its forecast and now projects a 2% decline for ATE in 2015. “When we look to 2015, we see that the market is probably flat to a little bit down,” said Greg Smith, vice president of SOC marketing at Teradyne. “The thing that would be dragging the market down is that companies may be digesting their current ATE capacity. And in some markets, customers are buying new testers that are much more productive. We have some market segments where the current state-of-the-art is two devices being tested in parallel. In some cases, customers are buying new (testers) that support eight devices in parallel. The main reason (for that) is to reduce the cost of test.”

In ATE, others have a similar outlook for 2015. “For the overall SOC ATE market, research analysts are anticipating that 2015 may decline from 2014,” said Neils Poulsen, director of business development for SOC test solutions at Advantest. “We anticipate the largest drop to occur in the digital segment, due to digestion of healthy capacity buys for application processors in 2014. However, we believe all other segments, including SOC, mixed signal, RF, analog and automotive to be relatively flat.” Meanwhile, the memory test market is expected to be flat in 2015, said Hanh Lai, marketing manager for memory test at Advantest. “For memory ATE, we anticipate new fabs for NAND/DRAM, high speed test requirements for LPDDR4/DDR4, and system level test for UFS/PCIE,” Lai said.