Semiconductor Lithography Equipment Market Size & Share Analysis - Growth Trends & Forecasts (2023 - 2028)

Semiconductor Lithography Equipment Market Size & Share Analysis - Growth Trends & Forecasts (2023 - 2028)

The Semiconductor Lithography Equipment Market size is expected to grow from USD 24.66 billion in 2023 to USD 35.21 billion by 2028, at a CAGR of 7.38% during the forecast period (2023-2028).

Key Highlights

• The worldwide semiconductor lithography equipment market is expected to grow. As 5G connections are implemented and used over the world, the performance of 5G can directly improve the production of smart products. Furthermore, Internet of Things (IoT) devices, such as 5G, may support multiple connections simultaneously while increasing speed, latency, reliability, and battery consumption.
• Smart device adoption is expanding and is expected to grow as 5G connections and adoption spread globally. According to the GSMA, 5G mobile broadband connections are projected to reach 1,100 million (1.1 billion) by 2025, with the 5G rollout estimated to cover 34% of the world's population by 2025.
• Manufacturing businesses are expected to gain a solid alternative with the advent of 5G, which is anticipated to provide the connection required for many Industry 4.0 applications, such as wireless control. This is especially important for mobile tools, machines, and robots that can help market growth during the forecast period.
• The semiconductor industry is regarded as one of the most complex industries, not only due to the more than 500 processing steps involved in the manufacturing and inspection and various products but also the harsh environment it faces, e.g., the volatile electronic market and the unpredictable demand.​ Depending on the intricacy of the manufacturing process, there can be up to 1,400 process steps in the overall manufacturing and inspection of semiconductor wafers alone. Transistors are formed on the lowest layer, but the process is duplicated as numerous layers of circuits are formed to create the final product.​ Such a complex process poses a challenge to the market's growth.
• The COVID-19 pandemic kept the capital equipment sector humming with a strong demand for next-generation electronics. According to SEMI, an industry association representing the global electronics product design and manufacturing supply chain, the global sales of semiconductor manufacturing equipment increased by 44% in 2021 to a record of USD 102.6 billion, up from USD 71.2 billion in the previous year.

Semiconductor Lithography Equipment Market Trends

Deep Ultraviolet Lithography (DUV) to Hold Major Market Share

• Deep UV lithography (DUV) is an optical projection lithography technique where the pattern on the mask is projected to the wafer surface through a 4X or 5X optical system. The wavelengths used for this type of lithography are 248 nm or 193 nm. This lithography is a high-speed lithographic technology ideal for large-area masters of discrete components that are not bigger than 22 mm x 22 mm, the typical wafer-level exposure field size of a DUV tool.
• The DUV lithography type is one of the leading lithography technologies of the next generation. The technology is cost-effective and has increased resolving power. The adoption of DUV lithography is driven primarily by the miniaturization trend. Lithography is used for printing complex patterns that characterize integrated circuits (ICs) on semiconductor wafers.
• Using DUV lithography, lightweight electronic chips with lower power demands are easy to achieve. The platform features enhanced power resolution and is cost-effective. These structures together form an IC, which is known as a chip. The semiconductor industry's search for even more efficient microchips means chipmakers have to study more structures onto a chip, making the chip faster and more efficient while also reducing production costs. This is expected to boost the market's growth over the forecast period.
• According to ASML, a transition to EUV may only boost demand for DUV. Chip manufacturers deploy EUV in the early stages of chip fabrication to apply the minor structures: transistors, smallest vias (the contacts that connect the source, gate, and drain to the complex interconnect layers), and possibly the connecting layer.
• The market is witnessing various investments as the companies are seeking a technology that can produce chips down to 7nm nodes. For instance, in Oct 2022, Canon announced the development of a new semiconductor equipment plant in eastern Japan which will produce semiconductor lithography systems and other devices. The facilities are expected to commence operation by the first half of 2025.
• Such developments by the major vendors, along with the initiatives taken by the government to boost their semiconductor production, are expected to drive market growth over the forecast period.

Asia Pacific to Witness Fastest Growth

• The Asia-Pacific region has emerged as the largest semiconductor market in recent years. The growing penetration of digital technologies, rapid urbanization, and industrialization are among the major factors contributing to this growth. Additionally, the presence of large semiconductor manufacturing, packaging and assembly industries also creates a favorable scenario for the growth of the lithography equipment market in the region.
• Driven by higher demand, supportive government regulations, and easy availability of raw materials and labor have also boosted the growth of the semiconductor manufacturing industry. Countries like China, Taiwan, South Korea, and Japan, among others, have significantly expanded their manufacturing footprint and continue to do so, creating a demand for semiconductor equipment. According to the Semiconductor Equipment and Material International (SEMI), in 2021, China was the leading spender on semiconductor equipment, followed by South Korea, Taiwan, and Japan. Furthermore, as reported by SEMI, China is expected to continue to maintain the top position in terms of semiconductor equipment spending next year, while Taiwan is expected to regain the lead in 2024.
• Since the beginning of the US-China dispute, China has been developing advanced chip-making technologies and equipment in-house. Hence, significant R&D investments are also being made both by public as well as private entities. According to SEMI, about 80 domestic companies (including joint ventures) in China are engaged in semiconductor equipment research and manufacturing.
• Similarly, in December 2022, Huawei confirmed the development of a light source component used in EUV lithography systems which are required for making high-end processors on sub-10 nm nodes.

Semiconductor Lithography Equipment Industry Overview

The market is concentrated due to a few vendors such as ASML, Veeco, and Nikon occupying the majority market share. The key equipment for semiconductor manufacturing is basically monopolized by American and Japanese companies. With growing consolidation and technological advancement, and geopolitical scenarios, the studied market is witnessing fluctuation. In addition, with increasing vertical integration, the intensity of competition in the studied market is expected to continue to rise, considering their ability to invest, which results from their revenues.

• September 2022 - Canon Inc. launched the "Lithography Plus1" solution platform for semiconductor lithography systems. Canon's more than 50 years of experience in semiconductor lithography system support and the company's vast wealth of data are incorporated into the system to maximize support efficiency and propose and implement optimized system processes.
• June 2022 - Samsung and ASML have agreed to collaborate on developing High-NA (high numerical aperture) EUV Lithography equipment, which will be available next year. Compared to older EUV Lithography equipment, the next-generation High-NA EUV Lithography equipment can engrave finer circuits.

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