Bearish projections for the coming year make the milestone forecast unlikely, prompting capital spending cuts that could slow Western foundry expansion plans.
By Bolaji Ojo
What’s at stake:
Semiconductor suppliers are basing their capital expenditure plans on forecasts that often miss targets by tens of billions of dollars. Only months after rolling out massive fab construction plans to serve what they believe would be a $1 trillion market by 2030, chipmakers are resorting to capex cuts that will impact future supplies.
Looking to grab a share of a projected $1 trillion in sales by 2030, semiconductor vendors and foundries have gone on an extraordinary capital expenditure spree just as the sector appears headed for another downturn. Those countervailing market forces are raising questions about the wisdom of expansive fab construction plans.