As the market for Thermo Compression Bonding (TCB) equipment diversifies, Semes, a subsidiary of Samsung Electronics and South Korea's leading semiconductor equipment manufacturer, is honing its focus on HBM-specific products to bolster its competitive standing.
While Semes' technology has been viewed as somewhat lagging, recent strides in next-generation product development and mass production mark a significant leap forward. These advancements are poised to elevate Semes' performance in 2024.
According to South Korean media outlet Deal Site, the synergy between Semes' technological breakthroughs and Samsung's improving performance is expected to strengthen considerably. The anticipated surge in HBM output from Samsung will likely bring a substantial influx of equipment orders to Semes, driving revenue growth and fostering a virtuous cycle of technological investment.
Rumors have surfaced that Samsung might consider other companies' equipment to enhance HBM yield rates. However, Semes' ongoing advancements in TCB technology are likely to quash these speculations. As Samsung's performance rebounds, the renewed synergy between the two companies is drawing industry attention.
Hanmi Semiconductor's TCB equipment has led the domestic market since 2023, capturing widespread interest. However, its dominance is waning as SK Hynix, its largest client, has recently forged supply partnerships with firms like Hanwha Precision Machinery.
Historically, Hanmi Semiconductor has provided equipment for the MR-MUF process, using liquid protective materials for SK Hynix. Meanwhile, Semes has supplied optimized TCB equipment for Samsung's Non-Conductive Film (NCF) process. Although Hanmi Semiconductor currently holds a technological edge, Semes is rapidly closing the gap. Recent achievements in TCB technology and process yield have seen Semes ship 100 units within a year.
Semes boasts several advanced technologies that were once entirely reliant on Japanese equipment but are now produced domestically in South Korea. The latest development of next-generation bonding equipment for AI HBM has already entered mass production. Semes aims to surpass KRW 250 billion (approximately US$180 million) in TCB sector revenue for 2024, about 2.5 times that of 2023.
The evolution of hybrid bonding technology is expected to significantly alleviate HBM stacking limitations. Samsung's recent announcement of achieving the first 16-layer HBM4 using hybrid bonding underscores the potential for process innovation.
As Samsung charts its return to growth, Semes is poised to benefit. However, Semes' heavy reliance on Samsung remains a double-edged sword.
In 2021, Samsung's robust performance propelled Semes to become South Korea's first semiconductor equipment company to surpass KRW 3 trillion in revenue. The semiconductor downturn that followed led to a revenue decline to KRW 2.5 trillion in 2023, with operating profit plummeting nearly 70% to KRW 66.8 billion.
Samsung's plan to triple its HBM production capacity in 2024 compared to 2023 is undoubtedly a boon for Semes. Nevertheless, with Samsung simultaneously employing equipment from Japanese firms like Shinkawa, the extent of Semes' gains might be curtailed.
As multiple memory companies, including Samsung, ramp up their HBM production capacity, the overall revenue from TCB equipment is expected to rise. To significantly enhance HBM yield, Samsung continues to rely heavily on Japanese equipment. For Semes to boost its performance, it must diversify its equipment investment and development.
