Paul van Gerven
20 November 2023

The global semiconductor manufacturing industry is on track for recovery in the fourth quarter of 2023, setting the stage for continued growth in 2024, Semi and Techinsights predict. Q4 IC sales are expected to rise 4 percent sequentially as end demand improves and inventories normalize. Electronic sales are predicted to register a robust 22 percent quarter-over-quarter increase in Q4 2023.

Despite the improvement in electronics and IC sales, semiconductor manufacturing indicators remain soft. Fab utilization rates and capital expenditures continue to decline in the second half of this year. Overall, capex on non-memory is expected to outperform memory in 2023, but even spending in the non-memory segments has begun to weaken. Total capital expenditures in Q4 2023 are hovering at the levels seen in Q4 2020.

Semi IC sales
Source: Techinsights

While overall semiconductor capital equipment sales are declining in line with capital expenditures, the contraction in wafer fab equipment spending has turned out to be much shallower than expected this year. Furthermore, back-end equipment billings are projected to increase in Q4 2023.

“While semiconductor markets have seen year-over-year declines the last five quarters, year-over-year growth is expected to return in the fourth quarter of 2023 as production cuts have worked their way through the supply chain,” says Boris Metodiev, director of market analysis at Techinsights. “On the other hand, front-end equipment sales have been performing much better than the IC market, buoyed by government incentives and the filling of backlogs, strengths expected to continue next year.”

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