Semi b2b Jumps to 1.08, and it’s Deceiving

The Semi equipment book-to-bill ratio jumped all the way to 1.08!  Can you believe that?  Well unfortunately, what matters is nominal bookings and billings.  Bookings eased a bit from December’s bump up and billings dropped harder.  In other words, the b2b was driven by Thing 1 dropping less than Thing 2.  So it is not at all positive, but could have been worse had bookings taken the larger drop.

semiconductor equipment book to bill ratio

SEMI’s mouthpiece weighs in thusly…

“Recent semiconductor order activity is on par with the figures reported one year ago,” said Denny McGuirk, president and CEO of SEMI.  “While uncertainty clouds the near-term economic outlook, we currently expect 2016 capex to remain in range of 2015 spending.”

The entire report can be viewed here at SEMI.

As you probably know, I follow this segment of the Semi industry as an early economic indicator.  It’s upturn in late 2012 led the entire stock market recovery and eventual economic bounce and its deceleration has led some economic softening into year-end and 2016.  Well, the Machine Tools sector was actually ahead of everything on this cycle as we caught its sharp downturn last summer, but you get the point.