Order activity jumped higher, but visibility in 2H20 remains low

    The Chip Insider®
    Semiconductor Equipment Weather Report: May 5, 2020
    Order activity jumped higher, but visibility in 2H20 remains low
    • Order activity for semiconductor equipment continued to warm up, jumping nearly four points to 64 degrees
    • With sales falling more than 8% sequentially in Q1, equipment market is primed for a strong bounce back in Q2
    • Equipment sales are expected to increase sequentially by mid-single digits in Q2 as additional revenue is recognized from shipments in Q1 and also from strong demand from China
    • This is a big sigh of relief for the equipment market in Q2 especially when compared to our negative forecast for Q2
    • Despite the improvement, we are not out of the woods yet
      • The prospects in 2H20 remain challenging due to the ongoing global recession and the potential of export restrictions on semiconductor equipment to China
    • VLSI's Chip Price Performance Index (CPPI) extended its decline
      • DRAM dropped
      • NAND dropped
      • MPUs declined
    • Electronics sales under pressure in 1H20