UBS: China’s Semiconductor Equipment Demand has Significantly Increased

An industry analysis by UBS pointed out that the demand for semiconductor equipment in China has significantly increased. UBS Securities analyst Yu Jia stated that the market’s expectation that China’s semiconductor manufacturing equipment would only have flat expenditures from 2023 to 2025 was too conservative.
UBS predicts that from 2024 to 2025, the demand for semiconductor manufacturing equipment in China will further increase from $20.7 billion in 2023 to $23-26 billion, reaching a new historical high. This is mainly due to the domestic wafer fabs with the highest capital expenditure, as well as the steady expansion of other mature process production capacity.

UBS expects domestic semiconductor manufacturing equipment expenditures to reach $11.2 billion, $11.5 billion, and $13.3 billion in 2023, 2024, and 2025, respectively, with a 20% increase over the next three years.
In addition, UBS expects the market share of domestically produced equipment in China to nearly double within three years. At present, Chinese suppliers have narrowed the technological gap, and their market share in etching, deposition, cleaning and other fields is expected to continue to increase in the next 1-2 years. They are more likely to make progress or breakthroughs in key processes and applications.
It is expected that the average annual growth rate of revenue for Chinese semiconductor equipment companies covered by UBS statistics from 2022 to 2025 will reach 39%. In addition, by 2025, the share of Chinese wafer factories will expand from 10% in 2022 to 19%.