Week In Review: Manufacturing, Test

The coronavirus (COVID-19) continues to have an impact on most, if not all, industries. This includes the electronics, semiconductor and related segments.

International Data Corp. (IDC) has released a report on the company’s view on the impact the COVID-19 virus will have on the semiconductor market. The report provides a framework to evaluate the market impact through four scenarios.

“The emergence of COVID-19 has brought with it travel bans and quarantines; massive slowing of the supply chain; uncertainty in the stock market; falling business confidence, and growing panic among the population,” said Mario Morales, program vice president of Semiconductors and Enabling Technologies at IDC. “Despite the growing uncertainty and panic, technology suppliers must continue to focus on their long-term investments, maintain engagement with partners and prospects, and look to specific markets for stability. Emerging technologies like 5G, the Internet of Things, high-performance computing, and intelligent edge will be fundamental to an overall recovery by the technology sector.”

Nearly all nations have been affected by the virus. The impact is especially apparent in Northern California. On March 16, several Northern California counties issued a “shelter-in-place” directive related to the COVID-19 virus. In fact, the entire state has a “shelter-in-place” directive.

This in turn impacted much of the tech industry, including some of the largest players. For example, Tesla announced that it will temporarily suspend production at its Fremont, Calif. And Google is reducing the need for people to come into its offices in the area.

The full impact on semiconductor industry financials remains unknown. Apple was one of the first to announce that the coronavirus would disrupt sales for the quarter. Since then, at least 150 companies have given warnings about possible earnings impact due to the coronavirus and forced closures based upon directives from various government agencies. According to CNBC, the list now includes Agilent, Alibaba, AMD, Analog Devices, Applied Materials, Baidu, Boston Scientific, Cree, HP, HPE, Jabil, KLA, Lenovo, Marvell, Microsoft, NXP, ON Semiconductor, Philips, Qorvo, Qualcomm, Skyworks Solutions and Sony. Lam Research, Veeco and FormFactor said they are withdrawing guidance due to the unknown impact of the shutdowns.

Many companies will continue to operate as rules allow. Intel, for example, recommended its employees work from home if their roles allow. Intel continues to operate on a relatively normal basis around the world, including manufacturing-related operations in Oregon, Arizona, New Mexico and California in the U.S., and in Ireland, Israel and China, according to a letter from its CEO. And TSMC said it would continue manufacturing chips even though one of its employees reportedly tested positive for COVID-19 and others are under quarantine.

Fab tools
Not all news for the week was negative. CyberOptics has received orders for its memory module and microLED inspection and metrology systems. CyberOptics anticipates that these orders will become revenue in the second and third quarter of 2020.

ACM Research has introduced the Ultra SFP ap, a system for advanced packaging. The Ultra SFP ap leverages ACM’s stress-free polishing technology, which is integrated with chemical mechanical planarization (CMP) and wet-etch chambers into a single system. It addresses yield issues arising from through-silicon via (TSV) processes and fan-out.

SEMI has released a central feature of its workforce development initiative, designed to grow the microelectronics industry’s talent pipeline, on the U.S. Department of Labor’s Competency Model Clearinghouse website. The Unified Competency Model (UCM) for Advanced Manufacturing identifies skill sets required across strategic industry sectors.

Numbers
North America-based manufacturers of semiconductor equipment posted $2.37 billion in billings worldwide in January of 2020, according to SEMI. The billings figure is 1.2% higher than the final January 2020 level of $2.34 billion, and is 26.2% higher than the February 2019 billings level of $1.88 billion.

“February billings of North American equipment suppliers extended a robust uptrend that began in December 2019,” said Ajit Manocha, SEMI president and CEO. “Despite continuing industry disruptions from the global spread of COVID-19, monthly billings for the year still remain above 2019 levels.”

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