AMEC's Revenue Grows with Advanced Etch Technology Fueling China's Semiconductor Surge

AMEC, China's etching tools giant, forecasts a 30%+ revenue jump in 2023, driven by local semiconductor demand and replacing US parts with domestic ones.

Advanced Micro-Fabrication Equipment Inc. (AMEC), a leading Chinese provider of semiconductor etching tools, is set to witness a significant revenue surge exceeding 30% in 2023, buoyed by robust demand from China's burgeoning semiconductor manufacturing sector. AMEC's strategic focus on core technological innovations has enabled the deployment of an array of sophisticated chip-making equipment to domestic fabs, catering to the critical process of etching in semiconductor production. AMEC's revenue for 2023 is projected to hit 6.26 billion yuan ($879 million), marking a 32.1% increase from the previous year, underpinned by a substantial 8.36 billion yuan in new orders. This growth trajectory is further evidenced by an impressive net profit forecast ranging between 1.7 billion yuan and 1.85 billion yuan, showcasing year-on-year growth of 45% to 58%. Central to AMEC's success is its adeptness in navigating the challenges posed by tightened US semiconductor sanctions. 

The company has embarked on an ambitious strategy to diminish reliance on foreign components, with a commitment to replacing 80% of US-restricted components with locally sourced parts by the end of last year, aiming for a complete transition by 2024. AMEC's product lineup, particularly its core etching tools like the capacitively coupled plasma (CCP) and inductive coupled plasma (ICP) systems, is pivotal to its revenue stream, anticipated to constitute 75% of its total earnings for the year. These etching tools, essential for the intricate process of sculpting microscopic circuits onto semiconductor wafers, have gained substantial traction among Chinese foundries. This is a testament to AMEC's technological prowess and its role in bolstering China's self-sufficiency in semiconductor manufacturing. 

The company's market share in domestic CCP equipment is expected to soar to 60%, a significant leap from 24% in October 2022. Similarly, AMEC's foothold in the ICP equipment market is projected to reach an impressive 75%, marking a dramatic rise from virtually zero. This growth is particularly notable against the backdrop of declining mainland sales of once-dominant US chip equipment manufacturers like Lam Research. AMEC's technological offerings, characterized by advanced etching capabilities and innovation-driven development, cater primarily to China's semiconductor fabs. These fabs are integral components of the nation's strategic push towards self-reliance in semiconductor production, a sector that has become a focal point of international geopolitical tensions and trade restrictions. As such, AMEC not only stands as a technological leader but also as a key enabler of China's ambitions in the global semiconductor arena.

Source: Chinese etching tools giant AMEC sees 2023 sales rise more than 30% on strong demand from mainland semiconductor fabs (yahoo.com)