China out-spending Taiwan, Korea, US combined on chip manufacturing equipment

China was the only country to increase spending on chip equipment in H1 with the US, Korea and Taiwan all reducing it.

Apart from renewed demand and higher ASPs for memory, plus the surge in demand for AI chips, most semiconductor product segments have seen growth of only 3-5%.

Since most of the equipment China buys is for older processes, and since the markets for older generation chips are currently low-growth, it is assumed that a lot of this equipment is being stock-piled rather than installed.

Nonetheless, China is expected to spend $50 billion on back end and front end facilities this year, according to SEMI.

This has been a  boon for Western equipment makers with some getting high percentages of this year’s revenues from China, according to their most recent earnings reports

For Tokyo Electron it was 49.9%, for ASML it was 49%, for KLA it was 44%, for Lam Research it was 39% and for Applied it was 32%.