The worldwide revenue of semiconductor industry has remained flat in last few years; to be more precise, overall semiconductor revenue declined by 1.9% in 2015 and Gartner forecasts it to further decline by 0.6% in 2016. The total revenue was at record high of $340.3 billion in 2014.
Well, semiconductor industry has matured. A market with growth of anything between 0 and 5% for five years or more can be considered as a matured. However, the health of semiconductor industry has been evergreen. This can be best judged by the way wafer fabs are moving up the chain. Although 450mm wafer volume production is not expected in this decade, the number of 300mm wafer fabs is continuously increasing since the beginning of 2002. The semiconductor companies are moving up the production facilities from 150mm and 200mm wafers to 300mm wafers.
The number of 200mm wafer fabs with volume production reached a maximum of 210 and then started declining. By the end of 2015, the number of 200mm wafer fabs was reduced to 148.
An IC Insights report provides this chart depicting the number of 300mm IC wafer fabs which are in volume production since 2002. The chart shows steady growth in the number of 300mm IC wafer fabs and forecasts it to reach 117 by 2020.
The only year when the number declined slightly was in 2013. This was because of closure of 2 fabs by ProMOS in 2013 and delay in schedule of some of the new fabs which were to be opened in that year. In 2014, the number of 300mm fabs jumped from 81 to 90. Naturally, this reflected in a handsome 8% increase in the semiconductor revenue in 2014 from $315 billion in 2013.
In the semiconductor industry, a growth of 0-5% in dollar terms would mean a much higher growth in terms of area of wafer produced because increase in scale of production of wafers reduces price per transistor drastically.
The arrival of 450mm wafer fab will determine how the number of 300mm wafer fabs will grow in future. Also, the price advantage with 450mm wafers is yet to be seen because of their higher production cost. Lithography is a big challenge in 450mm wafer production; the equipments are not there yet and will be highly priced when available.
Within the semiconductor industry, the wafer fab segment of the market is also maturing. The number of companies with fabs is declining. There are fewer companies with higher investment fabs like 300mm. Today, 200mm fabs are spread across 61 fab companies in the world, whereas 300mm fabs are concentrated among just 22 companies.
There will be still fewer companies with 450mm wafer fab facility. In last two years, we saw a large consolidation among semiconductor companies. Amid growing concentration of wafer fabs with fewer companies, there may be a challenge in reduction of price per transistor any further. However, the wafer production is expected to remain healthy.