Shenzhen chip headhunter companies have found that, according to the International Semiconductor Equipment Association (SEMI), Mainland China became the largest semiconductor equipment market globally starting in 2020.
Semiconductor Equipment Market: Growth and Challenges
In the rapidly developing IT sector, semiconductor equipment, as the core tool for chip manufacturing, is becoming a hot topic in the semiconductor industry. Whether in Mainland China or the global market, the semiconductor equipment market continues to expand.
Market Scale Hits Record Highs
According to Shenzhen chip headhunter companies, SEMI data shows that Mainland China became the largest semiconductor equipment market globally in 2020. In that year, semiconductor equipment sales in Mainland China grew by 39%, reaching $18.72 billion, while global semiconductor manufacturing equipment sales hit a historic high of $71.2 billion. In 2021, global semiconductor equipment sales surged by 44% to $102.6 billion, with Mainland China growing by 58%, maintaining its lead in the market. In 2022, global semiconductor equipment shipments increased further to $107.6 billion, and Mainland China continued to hold the largest market share for the third consecutive year, despite a 5% slowdown in investment, reaching $28.3 billion. In 2023, Mainland China’s semiconductor equipment spending accounted for about a third of the global total, reaching $36.6 billion, up 29% from the previous year. SEMI forecasts that in 2024, China’s semiconductor equipment procurement will hit a new record, surpassing $40 billion for the first time. However, by 2025, market demand is expected to return to normal levels and experience a downturn.
Market Downturn Warning
At a meeting in China in September, SEMI warned that semiconductor equipment procurement in China will drop to 2023 levels in 2025, with a predicted decrease of 5%-10% year-over-year. This trend is attributed to the previous large-scale purchases leading to decreased equipment utilization rates. Dutch semiconductor equipment giant ASML also reported that, while Mainland China remains its largest market, the CEO expects sales in China to decline to around 20% of the total market by 2025. SEMI predicts that between 2023 and 2027, China’s semiconductor equipment procurement will decrease by an average of 4% annually, while markets in the U.S., Europe, the Middle East, and Japan will see increases of 22%, 19%, 18%, and 18% respectively. Despite this, China will remain the world’s largest semiconductor equipment market, with total spending projected to reach $144.4 billion from 2024 to 2027.
Responses from International Semiconductor Equipment Manufacturers
Top companies such as ASML, Applied Materials, and Lam Research dominate the semiconductor equipment market. ASML leads in photolithography, while Applied Materials and Lam Research excel in etching, thin film deposition, and other equipment fields. Other strong competitors include Tokyo Electron, Advantest, and Disco. However, recent inquiries from the U.S. Congressional “Special Committee on China” to major international semiconductor equipment companies, requesting detailed information about their sales and customer composition in Mainland China, has increased operational pressure on these manufacturers in the Chinese market.
Rise of Domestic Semiconductor Equipment Manufacturers
According to Shenzhen’s analog chip headhunter companies, domestic semiconductor equipment manufacturers have made significant progress in several subfields. In etching machines, companies like Naura and North Huachuang are highly competitive; in thin film deposition, companies such as North Huachuang, Tuojing Technology, Naura, and Micro Nano have taken the lead in R&D; in photoresist and development equipment, CoreSource Micro is a major supplier; in cleaning equipment, companies like Shengmei Shanghai, North Huachuang, CoreSource Micro, and Zhichun Technology dominate the market. Thanks to the surge in domestic wafer fabrication plants and the growing market share of domestic semiconductor equipment within domestic wafer manufacturers, the semiconductor equipment industry is experiencing high demand. Domestic equipment companies have seen substantial growth in revenue, driven by increasing demand across different segments.
Impressive Performance
Several domestic semiconductor equipment companies reported significant year-on-year revenue growth in the first three quarters of this year. North Huachuang’s revenue increased by 39.51%, Naura’s by 36.27%, Tuojing Technology’s by 33.79%, Shengmei Semiconductor’s by 44.62%, Huahai Qingke’s by 33.22%, Changchuan Technology’s by 109.72%, and Huafeng Measurement and Control’s by 19.75%. As for net profit, North Huachuang’s net profit rose by 54.72%, Shengmei Semiconductor’s by 12.72%, Huahai Qingke’s by 27.8%, and Changchuan Technology’s by an astonishing 26,858.78%, marking the highest growth rate.
2025 Semiconductor Headhunter Industry Forecast
Research institutions have a positive outlook on the future performance of domestic semiconductor equipment companies. According to Hua Fu Securities, despite potential challenges in the first half of 2024 due to weaker growth in new orders from 2023, the production and delivery of equipment have accelerated significantly, leading to expectations of strong growth in subsequent performance. Kaifeng Securities estimates that, driven by increased capital expenditures in advanced memory and logic wafer fabs, as well as higher domestic equipment localization rates, China’s semiconductor equipment sales are expected to grow from $36.6 billion in 2023 to $65.77 billion in 2027, with a compound annual growth rate of 15.8%. With continued technological breakthroughs and market expansion, domestic semiconductor equipment manufacturers are set for even greater development prospects.
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