Outlook for 2023

Outlook for 2023

Bridging the slowdown and ensuring long-term growth.

Comet has started the new fiscal year financially robust and structurally stronger – and with a balanced market mix that enables it to parry the slowdown in the semiconductor market. The focus for 2023 is on exploiting the potential of the traditional automotive, aerospace and security markets and preparing for the next upturn in the semiconductor market.

“With digitalization progressing, the long-term drivers of our business are intact. We are getting ready for the next upswing.”

Stephan Haferl

CEO of the Comet Group

Correction in the semiconductor market, but traditional markets on track

The semiconductor market is in a correction phase, which has been accentuated since at least the fourth quarter of 2022 by the US export restrictions against China. Overall for 2023, experts are projecting a global decline of 16–20% in investment in chip manufacturing equipment compared to the prior year. Like other market participants, chip manufacturers and equipment suppliers, Comet has scaled back its expectations accordingly – but only temporarily. The reason is that, underneath the current market downswing, our era of digitalization in an increasingly connected and integrated world provides continued structural support for demand growth. Artificial intelligence, augmented and virtual reality, autonomous driving, and new technological applications are constantly fueling the use of data. This means that the demand for microchips will increase in the medium and long term – an opportunity for which Comet is preparing even in the current environment.

In Comet’s traditional volume markets of automotive, aerospace and security, the outlook for 2023 is positive overall, with differences in degree. In the automotive sector, industry analysts predict a further slight increase in global sales of new vehicles, led by demand for electric vehicles, which is to rise by 40%. The aerospace and security industries, too, are expected to see growth in global terms as travel continues to increase. These trends should have a positive impact for Comet in 2023, especially on demand for x-ray inspection solutions for non-destructive testing.

Macroeconomic unknowns

The macroeconomic factors remain difficult to assess. While the threats from inflation and possible energy shortages in Europe appear to be easing somewhat, the risks that make it more difficult to plan and to do business this year include – besides the war in Ukraine – some bottlenecks in supply chains, rising logistics and energy prices, and the possibility of a recession. In addition, it is important to closely monitor the US export restrictions on the supply of semiconductor equipment to certain Chinese customers and to review their legal implications. For Comet, 2023 will therefore be about successfully riding out the slowdown while preparing for the next semiconductor upswing and at the same time managing macroeconomic risks.

The Comet Executive Committee. From left to right: Dionys van de Ven (President of X-Ray Systems), Keighley Peters (CIO), Lisa Pataki (CFO), Stephan Haferl (CEO), Michael Kammerer (President of Plasma Control Technologies), Michael Berger (President of X-Ray Modules)

In a sound position to take advantage of growth opportunities and manage risks

Comet has the financial and organizational strength and resilience to stay its course in this volatile environment. In view of the decline expected in the semiconductor market for 2023, management has taken proactive measures to reduce the company’s variable costs. At the same time, Comet will continue to invest in its strategic initiatives, advance its research and development as planned, commercialize product innovations, expand capacity and position itself for the next upturn. This includes the strategic expansion of global production capacity, notably by investing in Comet’s production site in Penang, Malaysia, as well as merging the currently separate sites in Silicon Valley into one location. The aim is to make the most of the medium- and long-term growth opportunities available to Comet in the front-end and back-end segments of the semiconductor industry. That is what we are preparing for in this transition year of 2023. Efforts along these lines include the continuous development of our employees, as well as further improvements in sustainability. We will remain committed to our strategy built around growth, efficiency and culture and continue the systematic execution of the Boost strategic program.

Capitalizing on market opportunities in all divisions

“For us, 2023 is about bridging the short-term slowdown and seizing long-term opportunities."

Lisa Pataki

CFO of the Comet Group

PCT – Commercialization of Synertia®, capacity expansion for next upswing. In light of the long-term structural demand in the semiconductor market, the focus of the Plasma Control Technologies division in 2023 will be on adapting nimbly to changes in demand from its customers. The task at hand for PCT is to further optimize production capacity, quality and delivery times. With a view to the next upswing and continuous efficiency improvements, Comet will carry out the announced expansion of its production in Penang, Malaysia, and consolidate its four individual sites in San Jose, California, under one roof for greater efficiency and collaboration. The new Synertia® RF power platform points the way to a new future for plasma process control in the semiconductor industry. Following its successful launch, the goal in 2023 is to respond to the high level of interest from customers by bringing to market and commercializing additional variants as quickly as possible. The same applies to the freshly launched 3rd-generation match controller.

IXS – Creating value for customers through artificial intelligence. The focus of the X-Ray Systems division is on raising the productivity of its customers with solutions that enable data-driven insights and automated analysis in quality inspection. To do so, it will expand its software and service offerings by inspection workflows and drive its transformation into an even more focused and market-driven company. Building on the successes of the past two years, the objective is to expand the collaboration with leading manufacturers in IXS focus markets, especially in the semiconductor industry, and to broaden the range of solutions for these applications.

IXM – Exploiting the market potential in non-destructive inspection and further advancing into new applications. The X-Ray Modules division has successfully positioned itself in new applications in the last two years, such as in the inspection of batteries and semiconductor & electronics components and in high-end computed tomography, by expanding its product portfolio with the award-winning MesoFocus tube and other innovations. The aim is to continue on this path while keeping careful control of the supply chain, and thus seize the opportunities in the volume markets.