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Global chip capex forecast to drop 3 pct this year

All News 14:11 April 17, 2020

SEOUL, April 17 (Yonhap) -- Capital spending by global chipmakers is expected to dip 3 percent on-year to US$99 billion in 2020, with the industry remaining unscathed by the coronavirus outbreak so far, a market tracker said Friday.

The expected decline comes after capital expenditures by Samsung Electronics Co. and other heavyweights fell 3 percent last year, the first on-year drop since 2015, according to IC Insights.

Capex by three memory majors -- industry leader Samsung, No. 2 player SK hynix Inc. and U.S. chipmaker Micron Technology Inc. -- is forecast to sink 15 percent on-year to $33.6 billion this year.

Samsung and SK hynix are said to be adjusting their chip output after unveiling plans to optimize their production lines last year.

In contrast, Taiwan Semiconductor Manufacturing Company (TSMC), the top foundry maker in the world, is expected to expand its facility investments 8 percent this year, IC Insights said.

Chipmakers' investment in the foundry sector is projected to account for 29 percent of the industry's total capital spending for all of 2020.

IC Insights said it has not downgraded the industry's capex outlook because of the coronavirus pandemic, saying most investments proceed according to long-term plans.

Yet chipmaker's facility investments will have no choice but to weaken should the coronavirus outbreak last till the second half of the year, the industry tracker added.

This undated file photo shows a chip production line. (Yonhap)


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