Global Semiconductor Equipment Market Expands as Tokyo Electron Invests in New Manufacturing Facility

The global semiconductor equipment market is experiencing robust growth, fueled by increasing demand for artificial intelligence (AI), big data, and advanced chip manufacturing. In response, Tokyo Electron (TEL) recently announced a major investment in a new production facility in Miyagi Prefecture, Japan, dedicated to manufacturing plasma etching and other semiconductor production equipment.

Tokyo Electron's New Factory: A $7 Billion Investment

According to TEL, the new facility will require an estimated investment of JPY 1.04 trillion ($7 billion USD) and is set to begin construction in June 2025, with completion expected by summer 2027. The company aims to make this plant a world-class semiconductor equipment factory to meet the growing global demand.

In addition to this expansion, TEL also released its 2024 financial forecast, projecting JPY 1.83 trillion ($12.4 billion USD) in revenue, reflecting a 31.1% year-over-year increase. Net profit is expected to grow 44.5% to JPY 363.96 billion ($2.46 billion USD).

Semiconductor Equipment Market Growth and Key Players

The semiconductor manufacturing process requires a wide range of specialized equipment, broadly divided into front-end and back-end process equipment:

Front-end equipment: Includes thin-film deposition, etching, photolithography, ion implantation, chemical vapor deposition (CVD), wafer cleaning, chemical mechanical planarization (CMP), and coating/developing tools.

Back-end equipment: Encompasses wafer dicing, die bonding, wire bonding, encapsulation, testing, and sorting.

The rapid advancement of AI, high-performance computing (HPC), and storage chips is driving the semiconductor industry toward a $1 trillion market valuation, presenting significant opportunities for semiconductor equipment manufacturers.

According to SEMI, global semiconductor equipment sales are expected to reach $113 billion in 2024, marking a 6.5% growth year-over-year. China is expected to account for a record $49 billion of that total. The market is forecasted to expand further to $121 billion in 2025 and $139 billion in 2026.

Leading Semiconductor Equipment Manufacturers

Currently, the global semiconductor equipment market is dominated by a handful of major players, including:

ASML (Netherlands) – Lithography systems

Tokyo Electron (Japan) – Etching, deposition, and cleaning equipment

Applied Materials (USA) – Deposition, etching, and metrology tools

Lam Research (USA) – Etching and deposition equipment

KLA (USA) – Process control and yield management

Nikon & Canon (Japan) – Lithography systems

ASML, the leading provider of EUV lithography equipment, reported a record-breaking net revenue of €28.3 billion ($30.4 billion USD) in 2024, with Q4 net revenue reaching €9.3 billion ($10 billion USD).

China’s Growing Semiconductor Equipment Market

China has emerged as the largest semiconductor equipment market globally, driven by government support and growing domestic demand. Chinese semiconductor equipment manufacturers such as Naura Technology Group , Advanced Micro-Fabrication Equipment Inc. , ACM Research , Piotech , Hwatsing , and others have been expanding rapidly.

2024 Financial Performance of Key Chinese Semiconductor Equipment Companies

Based on financial forecasts, several major Chinese semiconductor equipment companies are experiencing strong revenue growth:

Naura Technology Group : Estimated $3.9-$4.5 billion in revenue, 25%-43.9% growth YoY.

ACM Research : Expected revenue between $790-$830 million, 44.02%-51.22% growth.

Piotech : Forecasted revenue of $565-$590 million, 47.88%-55.27% growth.

Hwatsing : Estimated revenue between $470-$520 million, 33.57%-49.52% growth.

Profitability Trends

While revenue growth remains strong, some Chinese equipment makers are seeing profit declines due to heavy R&D investments:

Naura, Hwatsing, and Changchuan Technology (长川科技) expect significant net profit growth.

Advanced Micro-Fabrication Equipment Inc. and Piotech anticipate profit declines due to increased R&D expenditures—for example, AMEC’s R&D investment surged by 94% YoY.

Changchuan Technology is expected to see a staggering 785.75%-1007.18% net profit growth, attributed to improved operational efficiency and expanded market share in integrated circuit testing.

Looking Ahead: The Future of Semiconductor Equipment

The global semiconductor industry is on the brink of a new era, driven by technological advancements in AI, HPC, and next-generation chip manufacturing. With major investments from key players like TEL, ASML, and leading Chinese manufacturers, the semiconductor equipment sector is set to play a crucial role in shaping the future of the industry.

As AI applications continue to surge, semiconductor manufacturers are ramping up their efforts to enhance wafer fabrication, packaging, and testing technologies to meet the demands of next-gen computing and data processing.