SAN JOSE – Capital spending across the semiconductor industry is undergoing a sharp upward recovery this year as the semiconductor market benefits from robust chip demand. But while the tea leaves for the next 18 months are unclear, most expect the semiconductor market recovery to continue, says SEMI.

Sales and orders are up for most segments of the equipment and materials markets: wafer processing, assembly and packaging, test, and related sub-segments, the trade group points out.

First-quarter orders for equipment were up five times over a year ago, with equipment billings for the first half likely to surpass the total spending for all of 2009. As a result, 2010 equipment spending is forecasted to reach $32 billion, up 8.5% compared to 2008, the trade group says.

Semiconductor materials are also experiencing remarkable growth. First-quarter shipments reported for silicon wafers and leadframes doubled year-over-year, and second-quarter shipments will likely show sequential improvement. Given strong electronics sales and a steady rise in semiconductor unit volumes, materials sales will grow at least 17% this year. Preliminary analysis forecasts growth continuing into 2011, with total revenues returning to previous market highs, according to SEMI.

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