Market Trends of Laser Industry for Semiconductor Industry
This section covers the major market trends shaping the Semiconductor Industry Laser Market according to our research experts:
The Inspection & Metrology Segment is Expected to Hold a Major Market Share
- Smartphones and other applications across consumer electronics, automotive applications, etc., drive the demand for high-performance, low-cost semiconductor materials. These industries have been inspired by technology transitions, such as wireless technologies (5G), Artificial Intelligence, etc. Also, the trend of increasing Internet of Things (IoT) devices is expected to force the semiconductor industry to invest in this equipment to attain intelligent products.
- Moreover, the rising digitization and increasing trends of remote work and remote operations have sparked the need for advanced semiconductor devices that enable various new capabilities. As the demands for semiconductor devices intensify consistently, advanced packaging techniques provide the form factor and processing power required for today's digitized world. According to Semiconductor Industry Association, during August 2022, global semiconductor industry sales were USD 47.4 billion, a slight increase of 0.1% over the August 2021 total of USD 47.3 billion. Such an increase in the demand for semiconductors is anticipated to offer lucrative opportunities for the inspection and metrology equipment market growth.
- Capacity expansions in the semiconductor industry are also aiding the growth of the studied market. For instance, according to SEMI Equipment Market Data Subscription (EMDS), the semiconductor industry's foot in 2021 was firmly on the accelerator. Capacity increases aided the expansion of both the front-end and back-end semiconductor equipment industries to meet growth drivers.
- Billings for semiconductor equipment in the United States increased by 44% yearly to USD 102 billion, surpassing the previous high established in 2020. Advanced logic and foundry capacity expansions, DRAM investment recovery, and robust NAND Flash spending drove equipment market growth. Equipment spending was high across the board in 2021, marking the first time the top three areas — China, Korea, and Taiwan – collectively spent more than USD 20 billion on capital equipment annually.
- Several companies are innovating new products to cater to the rise in demand for semiconductors and satisfy the complex requirements of consumers. For instance, in December 2021, Park Systems, a company that manufactures atomic force microscopes, created a tool for inspecting masks used in the wafer fabrication process's extreme ultraviolet (EUV) step. The equipment may check the cover for flaws and improvements without endangering it. The EUV laser can create even more precise circuit patterns on the wafer since its wavelength is fourteen times smaller than that of argon fluoride (ArF) lasers. As a result, the process's mask needs to be more precise and finely tuned. It can be expensive to have covers destroyed by dust when used in EUV processes.
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The Asia Pacific Region is Expected to Witness a High Market Growth
- The Asia-Pacific is one of the prominent regions for the semiconductor industry's manufacturing and consumption. According to Semiconductor Equipment and Materials International, spending on semiconductor equipment in China reached USD 29.62 billion in 2021. Moreover, in South Korea, spending amounted to USD 24.98 billion in 2021, while in Taiwan, it stood at USD 24.94 billion. The expenditure has increased yearly, which will drive the studied market.
- The region also boasts several initiatives by governments to boost the semiconductor industry. For instance, China's State Council's ‘2014 "National Integrated Circuit Industry Development Guidelines" aims to become a global leader in all semiconductor industry segments by 2030. Additionally, the Made in China 2025 initiative maintains achieving knowledge about advanced semiconductor manufacturing as a vital component of China's future economy and society. It is highly focused on the strategy to build a strong manufacturing nation across the world. The initiative is expected to encourage local and foreign companies to invest in the Chinese market across various segments, including integrated circuits. The initiative also prompts the government bodies to boost research and development activities so that China can rely on its own companies for core technologies rather than overseas ones. This propels innovation in the semiconductor manufacturing industry, thereby driving the laser market.
- Further, in December 2021, the Ministry of Electronics and Information Technology (MeitY) approved a comprehensive PLI scheme for developing semiconductor and display manufacturing ecosystems. Incentives worth INR 76,000 crore (USD 9.81 billion) were announced and will be distributed over the next six years. Such initiatives in the region are expected to drive the studied market.
- Semiconductors remain the backbone material of electronics integrated with modern devices like cars, smartphones, robots, and many other intelligent devices. Driven by the continuous need for miniaturized and powerful chips, current semiconductor manufacturing technologies face increasing pressure. Japan's electronic products industry, one of the largest in the world, is one of the most significant factors driving demand for semiconductors packaging in the region. As per the Japan Electronics and Information Technology Industries Association (JEITA), in 2021, the production value of electronic devices in Japan grew by 10.6% compared to the previous year, reaching a value of about JPY 3.94 trillion (~USD 28.5 Billion) in 2021. The increase in demand for electronics and intelligent devices in the region will likely offer lucrative opportunities for the growth of the studied market.
- As the demand for semiconductors has increased significantly in the Asia Pacific region in recent years, and as prominent semiconductor customers in several countries are strengthening their supply chains, investment in the semiconductor industry is further accelerated. For instance, in July 2022, GigaphotonInc., a manufacturer of light sources used in semiconductor lithography, announced that it would increase its production capacity by 2.5 times by constructing a new building in Japan. The company invested around JPY 5 billion (USD 36.2 million) in the construction of the new facility expected to be completed by June 2023. Such investments would boost the semiconductor industry's expansion of the laser market.
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