Summary: Bullish AAPL long-term on 2027 20th-anniversary iPhone cycle; near-term headwinds from tariffs and AI lag, but accumulation timing is the question.

What Apple’s Earnings Don’t Tell You

[Samsung Securities IT, Semiconductor/Lee Jong-wook]

1. The Truth Behind the Revenue Surprise

This quarter's earnings surprise is based on a revenue surprise. Although product revenue grew by 8.2%, the product Gross Profit Margin (GPM) decreased by 0.8%pts. The revenue surprise (+9.6% y-y) can be broken down into three main areas:

1. iPhone and MacBook sales (+13.7%)
2. Revenue growth outside the U.S./Europe (+12.3%)
3. Service revenue growth (+13.3%)Growth in the U.S. (+9.3%) and China (+4.4%) lagged the company-wide growth rate.

However, we believe the breakdown should be different.

- 1. Dollar Depreciation
The trade-weighted value of the U.S. dollar fell by 7.0% year-over-year. Considering its value fell only 0.9% against the Yuan (which has a 19% weight), the dollar's value excluding China dropped by 8.4%. Of the 12.3% revenue growth in regions outside the U.S. and China, 70% can be explained by foreign exchange rates. The difference in growth rates between China and ex-China regions is 7.9%pts, while the difference in currency fluctuations is 7.5%pts. What appears to be sluggishness in China is largely explained by the difference in exchange rates. Indeed, Apple mentioned the contribution from the weaker dollar during the Q&A session.

- 2. Inventory Front-loading Due to U.S. Tariffs
It appears that Apple's sell-in within the U.S. increased significantly after the tariff announcement in April. Global iPhone distribution inventory rose by 3.7 million units during the two months of April and May, a meaningful increase compared to 2024 (+0.6 million units) or 2023 (-0.4 million units). We suspect most of this occurred in the U.S. channel and is the reason why the U.S. grew during an unusual off-season period.

 - 3. Sales Growth
The places where Apple was truly competitive were Japan and India. The iPhone's market share in India is 10%, about half of its global share, and it saw benefits from the iPhone 16e launch. In Japan, where the Google Pixel usually sells well, Pixel sales were halted due to LTE patent infringement, and the Sony Xperia is undergoing free replacements for hardware defects. The iPhone is seeing a reflective benefit.

2. AI Competitiveness

- 1. M&A, As Quickly as Possible
Apple stated in an interview today that it is open to M&A of AI companies, which is welcome news from an investor's perspective. As we have mentioned, Apple's core is not technology but design and ecosystem, and it has shopped for most of its technology via M&A until now. This is not unusual at all. Rather, we believe that Apple solving AI through partnerships does not align with its philosophy, and it should be internalized through M&A.Considering past cases where productization occurred 2-3 years after an M&A, they are a bit late. However, the hopeful sign is that Apple is becoming more aggressive as it is increasingly backed into a corner.

- 2. Head of AI Shifts from Siri Lead to Vision Pro Lead
The new head of Apple AI, Mike Rockwell, was formerly the head of Apple Vision Pro development. Before Apple, he was an engineer at Dolby, developing 3D spatial environments and audio. His current interest is known to be the personalization of AI. He seems appropriate for bringing AI into the realm of consumer devices.

3. Tariffs

- 1. Who Will Be the Scapegoat?
Tariffs on semiconductor items are imminent. This is a period of increased volatility for Apple. Now that the decision has been made to impose tariffs on semiconductors, someone must be sacrificed. To simplify, it's a game of whether the scapegoat will be NVIDIA (AI), Apple (smartphones), or Dell & HP (PC, servers). Apple's priority for relief does not seem very high. Of course, tariffs on the iPhone raise inflation concerns, but if inflation were the U.S. government's top priority, it would not have pursued a tariff policy in the first place.

- 2. Hopes Are on 2027
As expected, our hopes are also pinned on the 20th-anniversary iPhone in 2027. We believe Apple's capabilities, from hardware to AI software, will be concentrated in 2027. The investment decision is a matter of when to start accumulating shares for the 2027 story. It is difficult to have high expectations for this year's iPhone.

Thank you.

$AAPL


Summary: Shares JPM/Harlan Sur's bullish AVGO preview: beat + guidance raise expected on AI ASIC/networking strength; FY25 AI rev >$20B, FY26 >$33B; top semi pick.

structural marker; pre-classified as canonical yfinance ticker

JPM (25/09/02)

AVGO: Earnings Preview — Strong AI demand expected to drive earnings beat and guidance raise; accelerated adoption from Google and Meta + continued AI networking growth.

Broadcom will announce its F3Q25 results after U.S. market close next Thursday. Harlan Sur’s preview highlights:

1. Optimistic demand outlook for AI ASIC and networking solutions;

2. Continued improvement in non-AI semiconductor businesses (enterprise, server/storage, broadband);

3. Further release of revenue synergies from VMware.He expects the company to deliver a beat, with AI revenue between $5.2–5.4 billion (consensus: $5.1 billion; buy-side mean: $5.26 billion), benefiting from the early shipment of Google’s TPU v6 3nm.

In addition, he expects AI semiconductor revenue guidance to grow 8–10% (over $6.0 billion), mainly driven by sustained strong AI networking demand, continued adoption of Google’s TPU v6 3nm, and ramping of Meta’s MTIA (inference) project. He estimates that Google’s TPU v6 3nm will contribute $9.0 billion in revenue over the next 6–7 months, with lifetime revenue exceeding $15 billion. On the networking side, demand for Tomahawk 5 / Jericho 3 AI remains strong, while Tomahawk 6 (3nm) is also accelerating its adoption.

Harlan’s model forecasts FY25 AI revenue to exceed $20 billion (+60% YoY), and FY26 AI revenue to surpass $33 billion, benefiting from new products and projects (Meta MTIA 3nm ASIC, TPU v7 3nm, SoftBank/ARM and OpenAI 2nm/3nm ASICs), as well as the ramp of Tomahawk 6. Cyclical trends in broadband, storage, and enterprise markets also support non-AI semiconductor businesses, while in software infrastructure Harlan continues to see strong momentum (particularly VMware renewal performance, driving further transition and upsell into the VCF full stack).

Given Broadcom’s deep exposure to AI infrastructure spend, diversified end-market coverage, and industry-leading gross margins, operating margins, and free cash flow margins, it remains his top pick in semiconductors.

$AVGO


Summary: Shares Citi note on AAPL: short-term China iPhone demand supported by promotions/tariff buffer, App Store growing low double-digits; regulatory/AI risks remain mid-to-long-term headwinds.

Apple Outlook: Short-Term Sales Benefit from Promotions and Tariff Buffer, AI Strategy and Regulatory Risks Remain Mid-to-Long-Term Focus
Citi (A. Malik, 25/07/10)

Citi notes that although iPhone short-term sales in China have benefited from tariff suspensions and 618 promotions, full-year demand remains affected by delayed AI features and tariff uncertainties. Meanwhile, Apple has shown positive signals in AI collaboration and App Store service growth, but regulatory pressure still poses a long-term risk.

Short-term Improvement in China Sales, But Full-Year Demand Remains Uncertain
Citi adjusted its iPhone shipment forecasts for the June/September quarters to 45 million and 50 million units respectively, reflecting short-term demand driven by promotions and a tariff buffer in the Chinese market. However, full-year forecasts remain at 226M/234M for CY25/CY26, representing -0.5% and +3.1% annual growth, primarily due to concerns over delayed AI features and uncertainties arising from the Section 232 tariff decision.

App Store Services Maintain Steady Growth Trend
Sensor Tower data shows that App Store revenue grew 12% year-over-year in Q2 2024. Although Apple has not provided specific service revenue guidance, Citi still expects low double-digit growth to be maintained. No significant signs of slowdown due to DMA reforms have been observed in the EU region yet, and the services business remains an important support.

AI Strategy More Open, But Large-Scale M&A Unlikely
Market rumors suggest Apple is considering adopting external LLM models to enhance Siri functionality, while also exploring third-party search AI integration in Safari. Although Apple opened its self-developed models for developer access at WWDC, indicating it retains an independent path, a more active trend of external cooperation, if realized, could boost investor sentiment. However, Apple has no history of large-scale M&A, and it is not expected to advance its AI布局 (AI layout) through major M&A.

Regulatory Risks Remain Key Downside Factor
Current regulatory risks, particularly the traffic acquisition cost (TAC) agreement with Google, are a key focus for investors. The Google antitrust case could trigger changes in Apple's revenue structure and cooperation model, leading to mid-to-long-term valuation pressure.

$AAPL


Applied Materials Bolsters Advanced Semiconductor Packaging… Designating it as a new growth engine… is expanding its investment in advanced semiconductor packaging

Summary: Author shares bullish report on AMAT expanding into advanced packaging as new growth engine, with Besi as key collaborator and AMAT as largest Besi shareholder.

industry='Semiconductor Equipment & Materials'

Report: Applied Materials Bolsters Advanced Semiconductor Packaging

Applied Materials, the world's largest semiconductor equipment company, is expanding its investment in advanced semiconductor packaging. Designating it as a new growth engine, the company has embarked on securing talent and developing new equipment solutions. This is interpreted as a strategic response to the increasing demand for advanced semiconductor packaging driven by the expansion of the Artificial Intelligence (AI) market.

According to industry sources on the 17th, Applied Materials has internally decided to make advanced semiconductor packaging a future growth driver and is moving to significantly enhance its competitiveness. To this end, it is understood to have initiated comprehensive efforts, from recruitment to new equipment.

For talent, aggressive recruitment is underway with no limitations on scale. Multiple industry insiders stated in unison, "Applied Materials is contacting the entire industry to secure high-level talent in advanced packaging. They are gathering so many people that it's as if they are 'sucking up' packaging personnel."

In particular, it has been identified that the expansion of personnel is centered around the Advanced Packaging Technology (APT) team in Taiwan. Applied Materials' Taiwan APT team is currently the organization leading major equipment development and is collaborating with global material and component companies, including those in Korea.

It is analyzed that R&D is being conducted with demand in mind, given Taiwan's strong semiconductor packaging ecosystem. Synergy is also expected with Applied Materials' Singapore Advanced Packaging R&D Center.

The company also plans to expand its packaging equipment portfolio. Currently, it is developing various packaging equipment, starting with lithography machines for semiconductor substrates. Development of hybrid bonding equipment, expected to be used in next-generation High Bandwidth Memory (HBM), 400-layer (or more) NAND flash memory, and 3D DRAM, is also in full swing. For this, Applied Materials is cooperating with BE Semiconductor Industries (Besi), a Dutch packaging equipment company. Applied Materials, which became the largest shareholder of Besi by acquiring a stake this year, has established a full-fledged collaborative system between the two companies.

Applied Materials' move comes as the advanced semiconductor packaging market is expected to grow rapidly with the proliferation of AI. The semiconductor industry is heavily investing in packaging technology to enhance performance by expanding bandwidth and increasing integration in advanced semiconductors like AI chips. This aims to overcome various challenges that could not be solved by existing front-end processes through packaging technology.

Until now, Applied Materials has had an equipment portfolio primarily focused on front-end processes. It boasts virtually all front-end process technologies, excluding lithography, such as thin-film deposition, etching, circuit control, polishing, and metrology. By expanding its scope to advanced packaging (back-end processes), including substrate processes and wafer bonding, it is analyzed that the company intends to significantly expand its equipment portfolio.

According to market research firm Global Information, the semiconductor packaging market is expected to grow from $104.1 billion (approximately 144.5 trillion KRW) this year to over 7% annual growth, surpassing $146.4 billion (approximately 203.2 trillion KRW) by 2030. An industry insider familiar with the matter stated, "I understand that Applied Materials is considering additional equity investments or mergers and acquisitions (M&A) to strengthen advanced packaging. They are building diversified strategies to enhance packaging capabilities."

$AMAT

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https://t.co/yuegOOUAEX


Applied Materials is cooperating with BE Semiconductor Industries (Besi), a Dutch packaging equipment company. Applied Materials, which became the largest shareholder of Besi by acquiring a stake this year


Summary: TSMC 2nm keeps EUV layer count same as 3nm, boosting customer adoption; bearish ASML on reduced EUV intensity, bullish TSMC on rising 2nm demand.

Very interesting. According to local reports in Taiwan, although TSMC’s 2nm adopts a GAA structure, the number of EUV layers is the same as in the 3nm process, so it’s not that expensive.

As a result, customers’ willingness to adopt it has clearly increased.

This is bad news for ASML, but good news for TSMC.

Apple’s iPhone 18 will come with an Apple C2 modem chip for the first time, while the A20 processor inside will be made on TSMC’s 2nm manufacturing process and WMCM advanced packaging, media report, citing unnamed supply chain sources. The MacBook’s M6 chip will also be made on


Nanya's DDR4 output through year-end is already sold out... August revenue reached NT$6.763 billion (US$224 million), up 141% year-over-year, while net profit rose 210%

Summary: Relays Digitimes analysis: DDR4 tightness benefits Nanya and Winbond; DDR5/LPDDR5X prices seen rising 5–10% per quarter from Q4 into 2026.

Nanya Technology Corp listed on TWSE as 2408.TW

China policy containment eases DDR5 price fears as Taiwan's DDR4 supply sells out- Digitimes

China's AI-driven supply chain expansion is reshaping the DRAM landscape. CXMT, the country's top DRAM producer, will pivot entirely to DDR5, LPDDR5, and high-bandwidth memory (HBM) in 2025. While fears of oversupply had raised concerns of DDR5 price swings, industry sources say Beijing is ring-fencing advanced DRAM for domestic use. This policy curbs export leakage and is expected to stabilize DDR5 pricing, with a gradual market upturn likely in 2026.

DDR4 supply tightens as major players exit
Global DRAM makers are phasing out DDR4, with CXMT joining the retreat. The contraction has tightened supply, benefiting Taiwanese suppliers Nanya Technology and Winbond Electronics. Even as DDR4 contract prices surge, supply-chain executives caution that quotes are largely academic — Nanya's DDR4 output through year-end is already sold out.

With only residual lines reserved for servers and industrial clients, DDR4 supply is critically tight. Taiwanese vendors cannot fully cover demand, leaving a supply gap projected at over 10% into early 2026.

Nanya's capacity is in high demand. DDR4 8Gb prices jumped 50% to US$3.9 by late July and further to about US$5.5 in September — over 40% higher. August revenue reached NT$6.763 billion (US$224 million), up 141% year-over-year, while net profit rose 210% to NT$811 million, marking a sharp rebound from losses.

Fourth-quarter contract prices are not finalized, but industry forecasts point to a 20% rise, slower than in the third quarter. With nearly all supplies already booked, buyers are scrambling to secure allocations ahead of time.

DDR5 and LPDDR5X outlook
DDR4's surge contrasts with DDR5's relative stability. Spot prices for DDR4 16Gb have overtaken DDR5 equivalents, reflecting the shift in capacity toward DDR5 and stable mainstream supply. However, CXMT's ramp into DDR5 raises concerns about pricing, given its history of undercutting DDR4 with steep discounts.

CXMT's DDR5, slated for 2025, will use 1Y/1Z nodes comparable to top global peers, though yields will take time to mature. Capacity could hit 300,000 wafers per month by late 2025, fueling worries of oversupply and price pressure into 2026.

Nevertheless, sources say China's localization policy is keeping most of CXMT's output at home. Ongoing work to raise HBM2 yields and sample HBM3 by late 2025, coupled with rising LPDDR5X demand from edge AI and cloud providers, reduces the risk of near-term DDR5 oversupply. Smartphone demand is weak, but embedded and AI workloads are driving strong order growth.

Prices set to climb into 2026
Industry insiders expect no significant price cuts for DDR5 or LPDDR5X. Despite yield challenges, pricing remains profitable, and tightening supply has already pushed spot prices higher in the latter half of the third quarter.

DDR5's rally should be more measured than DDR4's, with quarterly gains of 5–10% expected from the fourth quarter. LPDDR4 remains tight due to mid-tier smartphone adoption, while the industry's shift to LPDDR5X in 2026 is set to add further upward momentum.

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https://t.co/XyeaNWVIS3


The contraction has tightened supply, benefiting Taiwanese suppliers Nanya Technology and Winbond Electronics

Winbond Electronics listed on TWSE as 2344.TW


Summary: Relays GS thesis that EUV intensity pause is temporary; more EUV layers expected post-2nm, bullish for ASML.

We believe the pause in Lithography intensity is temporary, and as such see an increase in EUV exposed layers in the subsequent nodes post the 2nm process (given it is materially difficult to execute an architectural transition in tandem with incremental shrinkage- GS

https://t.co/NMPPqCIjBX

N2 and N3 have same number of EUV layers
ASML will benefit as overall demand expands
High NA adoption is key for ASML

Rn the biggest opportunity is to bet on the suppliers of TSMC's Advanced Packaging


Summary: Morgan Stanley flags ASML 2026 flat growth on EUV slowdown, TSMC flat CapEx, and WFE sector headwinds into summer 2025.

ASML: Facing Challenges in 2026, Slowdown in EUV Spending, TSMC CapEx Remains Flat
Morgan Stanley (L. Simpson, 25/07/17)

Morgan Stanley notes that ASML will face challenges in 2026, with an expected flat growth from 2024-2026 due to a slowdown in EUV spending. While TSMC's sales are strong (expected to grow over 30% year-on-year in 2025), the company maintains a cautious outlook on its 2026 capital expenditure (CapEx). ASML expects a reduction in EUV equipment shipments in 2026, specifically only 21 units of TSMC's EUV Low Numerical Aperture (LNA) tools.

ASML Faces Slowdown in EUV Spending: According to Morgan Stanley's analysis, ASML will experience flat growth between 2024 and 2026, mainly due to a slowdown in EUV spending caused by several factors. These factors include fewer layers, limited options for fabs other than TSMC, slow adoption of High Numerical Aperture (HNA), and the end of the tool upgrade cycle. The uncertainty surrounding Samsung's HBM4 approval by NVIDIA is also expected to exacerbate this trend.

TSMC CapEx Outlook Remains Flat: Despite strong N2 demand, TSMC's capital expenditure is expected to remain around $40 billion in 2026, consistent with 2025. Morgan Stanley believes that even with TSMC's strong sales growth, its CapEx will not increase in sync with sales growth due to potentially decreasing capital intensity. TSMC is expected to focus on deposition and packaging, while the demand growth for EUV equipment will be constrained by flat layer counts and bottlenecks in capacity expansion.

Expected Decrease in EUV LNA Tool Shipments: Due to CapEx limitations, TSMC is expected to purchase only 21 units of EUV LNA tools from ASML in 2026, significantly lower than anticipated. Morgan Stanley points out that while TSMC plans some N2/A16 process development, 40 chip tape-outs are not expected to lead to a large-scale capacity expansion.

TSMC's Future Capacity Expansion Limited: Morgan Stanley expects an increase in TSMC's N2/A16 capacity in 2026, with N2 capacity projected to rise from 40k wafers/month in 2025 to 50k wafers/month. However, due to the lack of significant growth in EUV spending, TSMC's overall capacity expansion in 2026 is still expected to remain at a low level. Despite strong demand, TSMC may not significantly expand its EUV equipment capacity.

WFE Sector Faces Challenges: Morgan Stanley believes that summer 2025 may pose challenges for Wafer Fab Equipment (WFE) companies, especially considering ASML's uncertain guidance for the 2026 fiscal year and the uncertainty in HBM spending. Despite TSMC's strong sales growth in 2025, WFE companies may face challenges due to a cautious outlook on capital expenditure, particularly against the backdrop of slowing EUV spending.


summer 2025 may pose challenges for Wafer Fab Equipment (WFE) companies

Wafer Fab Equipment basket: AMAT, Lam, KLA, ASML, TEL


TSMC's capital expenditure is expected to remain around $40 billion in 2026, consistent with 2025


Morgan Stanley maintains an "Overweight" rating and raises its price target from $338 to $357

Summary: Shares Morgan Stanley Overweight on AVGO with PT raised to $357 on AI ASIC/networking strength and 2026 revenue upgrade.

Broadcom F3Q25 Outlook:

Morgan Stanley (25/09/02)

Broadcom (AVGO) continues to see improving performance outlook driven by strong growth in AI ASIC and networking businesses. Morgan Stanley believes the company’s 2026 AI revenue forecast should be raised to $31.6 billion, up 53% year-over-year, with ASIC revenue expected to grow 61% to $20.8 billion, mainly supported by new customer adoption and rising TPU demand. This scale aligns with the company’s 2027 serviceable available market (SAM) target of $60–90 billion, implying that 2026 revenue must exceed $20 billion to support rapid expansion the following year. Although access to the China market remains uncertain, the largest ASIC project, TPU, is performing steadily, Meta’s MTIA project is progressing as planned, and surging inference demand combined with CoWoS capacity outlook makes Morgan Stanley more optimistic about Broadcom’s ASIC business.

In AI networking, Ethernet continues to gain market share. Morgan Stanley expects 2026 AI networking revenue to grow 39% year-over-year to $10.8 billion. Arista’s results show that major cloud customers are accelerating Ethernet cluster adoption, further confirming the view that Ethernet, with its open ecosystem and standardization advantages, will dominate the scale-out AI networking market.

On specific forecasts, Morgan Stanley raised FY26 AI revenue to $28.3 billion and the company’s total semiconductor revenue to $46.3 billion. Forecasts for 2025/2026 revenue and EPS are $62.7 billion / $6.68 and $75.1 billion / $8.07, respectively. For the July 2025 quarter, AI revenue is expected at $5.1 billion, up 16% sequentially, benefiting from double-digit growth in both ASIC and networking; for the October quarter, AI revenue is expected to grow 5% sequentially, with networking potentially providing further upside. The company’s new ASIC project pipeline continues to contribute momentum, with TPU likely to exceed expectations thanks to better pricing and stronger customer adoption.

In non-AI businesses, Morgan Stanley expects cyclical recovery in semiconductors to gradually materialize, with enterprise networking, broadband, storage, and wireless seeing flat to slight sequential growth; software trends may fluctuate, but overall remain at low single-digit growth, while VMware asset integration remains steady. For the July quarter, total company revenue is expected at $15.876 billion, up 21.5% year-over-year, in line with consensus; gross margin at ~78.1%, EPS at $1.68, slightly above consensus. For the October quarter, revenue is expected at $16.9 billion, up 20.3% year-over-year, with AI revenue at $5.4 billion, gross margin at 77.8%, and EPS at $1.82, again slightly above consensus.

Overall, Morgan Stanley believes Broadcom is well-positioned in the AI infrastructure investment wave, with new ASIC adoption and Ethernet ramping serving as key growth drivers. While long-term uncertainties exist, its ambitious SAM target appears achievable. Morgan Stanley maintains an “Overweight” rating and raises its price target from $338 to $357, based on a CY26 EPS of $7.13 and a 50x multiple, reflecting strong long-term growth prospects and solid execution.

$AVGO


Summary: B40 China demand of 2M/5M units adds $13B+ incremental revenue; bullish on Nvidia.

Instead, Morgan Stanley noted that Chinese customers are showing strong interest in Nvidia’s B40 chip, projecting demand of 2 million units this year and 5 million units next year.

$NVDA

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This means that, at a minimum, an additional $13 billion in revenue will be added for Nvidia! (According to a previous Reuters report, the estimated unit price of the B40 was $6,500.)


risk factors have emerged for Micron's HBM4 CS and mass production schedule... if Micron's HBM4 supply to Nvidia becomes difficult or is delayed compared to the original schedule, this could lead to an expansion of SK Hynix's share as Nvidia's primary supplier

Summary: Micron faces HBM4 risk from NVIDIA's raised 10Gbps speed requirement; DRAM-process base die disadvantaged vs SK Hynix/Samsung foundry approach, threatening Micron's schedule and share.

Micron, Risk Factors in HBM4

We estimate that risk factors have emerged for Micron’s HBM4 CS and mass production schedule.

The reason is that Nvidia has recently raised the speed margin requirements to 10Gbps, higher than before, and presented them to all three DRAM makers. Unlike SK Hynix and Samsung Electronics, which will produce the base die of HBM4 through foundry processes, Micron continues to produce the base die through DRAM processes. Because of this, it is assumed that achieving 10Gbps speed may be difficult. DRAM’s 1b nano corresponds to the 12nm class, the same linewidth as TSMC’s 12nm foundry that SK Hynix uses for HBM4 base die production. However, DRAM transistors have a planar structure, and compared to the 3D FinFET of foundries, they are inferior in performance and power ratio, imposing restrictions on high-speed logic implementation. For this reason, SK Hynix decided to use TSMC’s 12nm foundry to produce base dies in preparation for the heightened performance requirements of HBM4. Samsung Electronics will also produce base dies for HBM4 using Samsung Foundry’s 4nm process.

In HBM3e, Nvidia’s speed margin was 8.5Gbps, but Micron reportedly already achieved 9.2Gbps with 1b nano. Nvidia’s HBM4 speed requirement was initially 9.0Gbps. Since Micron had already achieved 9.2Gbps in HBM3e with 1b nano, it would have judged that it could meet speed requirements in HBM4 as well. However, it has been identified that Nvidia recently demanded all three DRAM makers raise it further to 10Gbps. The reason lies in HBM4’s bandwidth (the amount of data transferable per unit time). One of the biggest bottlenecks in AI systems is still the long time GPUs spend waiting for data from HBM. Therefore, increasing HBM’s bandwidth to reduce GPU idle time is very important for improving AI system performance and achieving cost efficiency. Although increasing pin speed raises power consumption, while HBM4 was initially conceived with lower pin speeds, Nvidia ultimately seems to have judged that increasing bandwidth is more important than power efficiency for AI system improvement.

Micron DRAM is known for its good low-power characteristics, but as described above, since it produces HBM4 base dies with DRAM processes just like in HBM3e, it may be at a disadvantage in terms of speed. For these reasons, if Micron’s HBM4 supply to Nvidia becomes difficult or is delayed compared to the original schedule, this could lead to an expansion of SK Hynix’s share as Nvidia’s primary supplier.

$MU


this could lead to an expansion of SK Hynix's share as Nvidia's primary supplier


we revise Broadcom's CoWoS booking in 2026 from the original 145k at TSMC to 205k

Summary: Shares Morgan Stanley note: AVGO CoWoS allocation revised sharply up to 205k; MediaTek PT cut to NT$1800 on delayed TPU v8 tape-out.

Morgan Stanley’s comments on ASIC CoWoS allocation:

Updates on our 2026 CoWoS allocation estimates: We keep our 2026-end CoWoS capacity as 93kpwm at TSMC, but fine-tune the allocation based on recent industry dynamics. Numbers are based on our Asia supply chain checks:

- OpenAI: a small CoWoS booking (around 10k) for OpenAI in 2026.

- Google: The 3nm TPU v7 from Broadcom shows volume upside in 2026, and we revise Broadcom’s CoWoS booking in 2026 from the original 145k at TSMC to 205k. This implies TPU volume may reach 3mn from Broadcom.

The 3nm TPU v8 from MediaTek should tape-out slightly later in October. Given tape-out delay, we now cut our estimate to around 200k-300k (previously 300k-400k) of TPU v8. We revise down MediaTek's target price to NT$1800, accordingly.

$AVGO


we revise down MediaTek's target price to NT$1800, accordingly


SK hynix leads HBM4 qualification with early customer sample shipments… SK hynix: raised to ₩460,000

Summary: Shares JPM 4-year memory supercycle thesis: SK Hynix PT ₩460K, Samsung PT ₩100K; HBM4 TAM $90B by 2027, DRAM prices rising 4 consecutive years.

Entering a 4-Year Memory Supercycle (JPM)

1. Global Memory Cycle
    • With surging datacenter and AI compute demand, a four-year upcycle is expected from 2024–2027.
    • Global memory TAM revised up by 6–24% versus prior estimates.
    • Introduction of HBM4E in Rubin Ultra GPUs will drive 4× memory content growth compared to the previous generation.

2. HBM Outlook
    • In 2026, HBM3E is expected to face oversupply and downward price pressure, but HBM4 supply constraints could support a 35% price premium.
    • HBM4 TAM projected to accelerate to $90 billion by 2027.
    • SK hynix leads HBM4 qualification with early customer sample shipments; Samsung and Micron are expected to compete with less than 40% market share.
    • Rubin Ultra’s surge in HBM demand → simultaneous growth in pricing and TAM from 4× content increase.

3. DRAM
    • For the first time ever, DRAM prices are forecast to rise for four consecutive years (2024–2027).
    • By 2027, HBM will account for 43% of DRAM TAM → reduces price volatility and provides downside margin protection.
    • Broader demand diversification from new applications such as SOCAMM2 and GDDR7.
    • DRAM TAM expected to grow at a 27% CAGR through 2027.

4. NAND
    • Two years of underinvestment and HDD shortages → expanding adoption of eSSD.
    • NAND ASP projected to rise +7% by 2026, though it is still too early to classify NAND as a structural AI storage essential.

5. Valuation
    • Stock prices have surpassed prior peaks within just 1–2 months.
    • While current valuations are at past cycle highs, structurally improved margins mean simple historical comparisons are inappropriate.
    • Top picks: SK hynix > Samsung Electronics > Nanya.

6. CapEx and Technology Trends
    • Memory CapEx expected to rise 7–12% in 2026–2027 to meet demand surge.
    • Investments concentrated in DRAM, prioritizing HBM; NAND focus remains on utilization improvements and gradual transition investments.
    • From HBM5 generation (post-2027), hybrid bonding adoption expected to accelerate → key equipment vendors to benefit.

7. Target Price Revisions
    • SK hynix: raised to ₩460,000
    • Samsung Electronics: raised to ₩100,000


Top picks: SK hynix > Samsung Electronics > Nanya

Nanya in memory context = Nanya Technology, TWSE 2408.TW


Samsung and Micron are expected to compete with less than 40% market share


DRAM prices are forecast to rise for four consecutive years (2024–2027)… DRAM TAM expected to grow at a 27% CAGR through 2027

DRAM sector basket: Micron, Samsung, SK Hynix


we estimate this deal ultimately translates into ~$400B of NVDA revenue over a multi-year period… this helps to flesh out multi-year visibility to the substantial growth headroom

Summary: Shares UBS: OpenAI-NVDA deal ~$400B revenue, multi-year visibility bullish; AVGO ASIC intact; AMD most negatively impacted by NVDA dominance.

(Must read) UBS Commentary on the OpenAI–NVDA Deal:

While timing will, to a large degree, depend on OpenAI's ramp plan, we estimate this deal ultimately translates into ~$400B of NVDA revenue over a multi-year period. Given the sheer size of the numbers, it does seem likely there could be some overlap with Oracle's capacity allocated to OpenAI, but our conversation with management suggested this is largely incremental. For NVDA, this helps to flesh out multi-year visibility to the substantial growth headroom it laid out last earnings call when it highlighted a $3-4T TAM by 2030 (of which NVDA's share has been ~30-35%) and we believe it was OpenAI approaching NVDA for help rather than any sort of vendor financing effort on the part of NVDA. As for AVGO, this could ultimately impact the size of its ASIC revenue from OpenAI, but we have seen no signs of any weakening in what we believe to ultimately be a volume target bigger than what Google does with AVGO. Ultimately, this feels the most negative for AMD as it solidifies NVDA's market dominance.


we have seen no signs of any weakening in what we believe to ultimately be a volume target bigger than what Google does with AVGO


this feels the most negative for AMD as it solidifies NVDA's market dominance


this certification will serve as a signal that Samsung's HBM competitiveness has been strengthened

Summary: IM Securities sees Samsung HBM3E NVIDIA cert likely this week/next, limited near-term sales but a positive signal for HBM competitiveness recovery.

Samsung Electronics HBM3E 12-Hi NVIDIA Certification News – IM Securities Comment by Myungsub Song

The official announcement is expected this week or next, and as we have mentioned before, the likelihood of passing appears to be very high.

Unlike in the past, when NVIDIA never disclosed the status of certifications, it is reported that during this re-certification process, NVIDIA has been communicating with Samsung almost every week.

However, as the certification period has been prolonged, even if certification is passed, sales volume is expected to remain quite limited. That said, this certification will serve as a signal that Samsung’s HBM competitiveness has been strengthened.

For HBM4, engineering samples have already been delivered to NVIDIA, and the final completed samples are scheduled to be sent around November. Therefore, the final certification results are expected to be announced around January or February next year.


Summary: Samsung Securities: VEU termination is a minor positive for memory (Samsung, SK Hynix) via potential supply delays pushing product prices higher.

Samsung Electronics listed on KOSPI as 005930.KS

Impact of VEU Renewal Termination on Memory
[Samsung Securities – Semiconductor, IT / Jong-Wook Lee]

Over the weekend, the VEU renewal for Samsung Electronics and SK hynix was terminated, and last night the termination of TSMC’s VEU renewal was also mentioned. Below, we share our outlook and investment ideas.

1. If the VEU is abolished, it is not Samsung or SK that apply for export licenses, but AMAT and Lam Research. The inconvenience falls on the equipment makers. The VEU is a system established for the convenience of U.S. equipment companies’ exports.

2. The U.S. Department of Commerce (BIS) also recognizes the necessity of the VEU. There is a high possibility that the VEU will be extended.

3. However, the current U.S. administration emphasizes that the VEU can be abolished at any time, and may use it as a political tool. This process will increase uncertainty.

4. If the VEU is permanently abolished, Samsung and SK’s investment decision-making and subsequent execution could be delayed by about 2–3 months. If supply is delayed, the possibility of product price increases rises.

5. Even if the VEU is abolished, it is unlikely that inconvenient U.S. equipment will be replaced with Chinese or Korean equipment. The benefits for equipment that is not subject to the VEU, or for Chinese equipment, will be limited.

Therefore, regarding this news, memory companies stand to benefit minor positive, while for TSMC and equipment makers the impact is neutral.

Thank you.

(Published September 3, 2025)


Summary: Morgan Stanley: Besi upside on TCB/packaging, ASML raised on China demand; ASMI constructive but cautious on FX; VAT most at risk with order/margin pressure.

ASM International Amsterdam; US OTC ADR ASMIY

European Equipment Outlook: FX Pressure and China Order Pull to Dominate This Earnings Season

Morgan Stanley (N. Putten, 25/07/15)

Morgan Stanley believes that unfavorable exchange rate impacts and potential demand recovery in the Chinese market will be the main conflicting factors in this round of European semiconductor equipment stock earnings reports. ASMI will experience both benefits and pressures, Besi may have upside potential beyond expectations, and VAT faces significant risks.

ASMI May Be Dragged Down by FX, Full-Year Outlook Still Supported by China Recovery

ASMI's 2Q order flow was significantly affected by the weakening exchange rate (USD vs. EUR), with order forecasts below market consensus. However, a recovery in Chinese demand is expected to provide rebound momentum in the second half. Morgan Stanley maintains a constructive view but remains tactically cautious.

Besi Orders Have Upside Potential, Mainly from TCB and Flip-Chip Packaging Demand

Besi is impacted by exchange rates by approximately 5%, but this may be offset by packaging orders related to NVIDIA B30 and RTX 6000 Pro. The $20 million TCB order announced in May will also provide support.

VAT Group May Be Under Most Pressure, Both Orders and Margins Affected

Due to exchange rate drag on orders by approximately 5%, high inventory limiting new demand, and emerging gross margin pressure, VAT Group may find it difficult to maintain its full-year growth guidance, with order forecasts below market consensus.

Aixtron Maintains Neutral Outlook, No Significant Change in Orders and Full-Year Guidance

Aixtron's outlook remains neutral. The company is denominated in Euros, so the exchange rate impact is relatively controllable. Orders and full-year forecasts are expected to remain flat.

Overall, FX Drags on ASMI and VAT, ASML and China-Related Exposure May Expand

A weaker USD has a high single-digit percentage negative impact on primarily USD-denominated companies like ASMI and VAT. However, ASML and ASMI may gain some buffer from new demand in the Chinese market. Morgan Stanley has thus raised its 2025 forecasts for both companies.


Besi Orders Have Upside Potential, Mainly from TCB and Flip-Chip Packaging Demand


VAT Group may find it difficult to maintain its full-year growth guidance, with order forecasts below market consensus

VAT Group listed on SIX Swiss Exchange as VACN.SW


ASML and ASMI may gain some buffer from new demand in the Chinese market. Morgan Stanley has thus raised its 2025 forecasts for both companies


$35–40 billion could flow into NVIDIA's revenue... structurally expanding demand for NVIDIA

Summary: Shares Morgan Stanley view: NVIDIA–OpenAI deal represents long-term upside via $35–40B revenue potential and structural demand expansion from compute arms race.

On the NVIDIA–OpenAI Deal (Morgan Stanley)

1. Financial Implications
    • Estimated AI infrastructure build-out cost: $50–60 billion per gigawatt (GW)
    • Of this, around $35–40 billion could flow into NVIDIA’s revenue (realized over a long-term horizon)
    • Historical context: the world’s largest GPU clusters today are only a few hundred megawatts in scale; 10 GW represents a disruptive scale by industry standards
    • Morgan Stanley is not yet incorporating these numbers into earnings estimates, viewing them instead as a long-term upside driver. The emphasis is on growth potential over time rather than immediate, confirmed revenues

2. Industry Implications
    • OpenAI’s aggressive infrastructure investment—at a scale far exceeding rivals—intensifies the AGI race
    • As the “compute arms race” accelerates, large tech and cloud companies could pursue similar investments, structurally expanding demand for NVIDIA

$NVDA


Summary: Citi: Nvidia SOCAMM2 transition deepens commodity DRAM shortage; SK Hynix, Samsung, MU, Simmtech, ISC, Hana Micron all expected to benefit.

Global commodity memory basket: major DRAM producers

250915_Global Semiconductors: Commodity Memory Supply Shortage Expected to Deepen Further as Nvidia Pivots to SOCAMM2 - CITI

1. According to Korea’s ETNews, NVIDIA has halted its existing SOCAMM1 project and shifted to SOCAMM2, currently undergoing product sampling in collaboration with SEC, SKH, and MU.

2. SOCAMM2 is expected to be commercialized in early 2026 [with the potential integration of LPDDR6 in the future].

3. This transition is anticipated to further exacerbate the shortage of commodity memory supply.

4. Compared to the previous SOCAMM, SOCAMM2 does not offer a major difference in data transfer speed, but it features improved interfaces optimized for ARM-based CPUs.

5. The data transfer speed reaches 8,533 MT/s, which is approximately 33% faster than standard server DRAM (6,400 MT/s).

6. However, SOCAMM2 has 128 I/O pins, double that of standard server DRAM, significantly enhancing large-scale data processing and scalability.

7. SOCAMM demand in 2026 is projected to reach around 27 billion GB, with each VR200 device expected to require about 3TB of SOCAMM.

8. This implies a sharp increase in memory content per device.

9. Overall, SOCAMM demand in 2026 is expected to account for about 7% of total DRAM demand and around 32% of mobile DRAM demand.

10. Both SK Hynix and Samsung Electronics are expected to benefit, with related beneficiaries including Simmtech, ISC, and Hana Micron.


Both SK Hynix and Samsung Electronics are expected to benefit


currently undergoing product sampling in collaboration with SEC, SKH, and MU


related beneficiaries including Simmtech, ISC, and Hana Micron

ISC Co. 095340.KQ Korea KOSDAQ socket/test


Hana Micron 067310.KQ Korea KOSDAQ semiconductor pkg


We reiterate our Buy rating and keep AVGO as our top pick… we lift our PO from $300 to $400, applying 37x FY26 P/E

Summary: BofA reiterates Buy on AVGO, raises PO to $400; 4th mega customer (OpenAI), FY26 AI growth ~110%, EPS raised 21–35%.

BofA) Broadcom: “Shock-and-Awe” results — accelerating AI pipeline, powerful operating leverage, Price Objective (PO) $400

1. Accelerating AI pipeline; estimates raised 20–35%; EPS potential of $17–$20
We reiterate our Buy rating and keep AVGO as our top pick. We see a high likelihood that a fourth mega customer (reported by the press as OpenAI) joins Broadcom’s custom AI chip (XPU) business alongside the existing three (Google, Meta, ByteDance). With roughly $10B of incremental revenue in 2HFY26E, we lift our FY26 AI growth outlook from YoY 55–60% to about 110%. AVGO also indicated growth could further accelerate in FY27E on additional programs and new customers. Meanwhile, opex is expected to grow a modest 5–8%, creating substantial operating leverage and lining up with a period when AVGO deploys more cash to debt paydown. Net, we raise our FY26/FY27 EPS estimates by 21%/35% to $9.62/$13.36. Note: our FY27 assumes a more conservative AI growth of 50–65% YoY. If FY27 were to grow at a FY26-like 110%+ pace, EPS potential could approach $17–$20 on leverage. Reflecting faster EPS growth and accelerating profit, we lift our PO from $300 to $400, applying 37x FY26 P/E (prior 35x).

2. As the AI pie expands, AVGO’s share rises
We agree AVGO is taking more share, but the overall AI market is also expanding toward the multi-trillion-dollar TAM cited by NVDA. Assuming AVGO and NVDA are the only two suppliers for now, we estimate AVGO’s CY25E share of computing + networking AI at ~11% ($23B out of $205B consolidated data-center revenue). Taking AVGO’s commentary at face value, AI revenue could approach $100B by CY27E, implying share could more than double to 24% ($100B of $418B). While such a scenario could pressure NVDA’s stock in the short term, we see greater risk that our NVDA CY27 data-center revenue forecast ($318B in our model) is actually conservative. AVGO’s custom silicon, networking, and scale are compelling, but they are (mostly) limited to internal workloads—not enterprise, not government, and not emerging-cloud facing—and exclude software or developer support. Over time, the evolution of “internal-use” vs “external-facing” markets could shift share between NVDA and AVGO.

3. Risks: customer concentration; ASIC/networking competition
We note Google accounts for 30%+ of FY25E semiconductor revenue. Concentration risk is unavoidable in capital-intensive AI, but AVGO’s exposure to Google (15–20% of total FY25 revenue; 30%+ on semiconductor revenue alone, by our estimate) is notable. Unexpected order changes, new competitors, or content shifts (e.g., memory disaggregation) could raise risk. Second, NVDA’s improved networking stack is intensifying competition in networking, especially in clusters where NVDA’s rack-scale solutions are deployed.

$AVGO


Summary: Long LRCX as beneficiary of TSMC excluding AMEC equipment from its fabs to qualify for US subsidies.

Excluding AMEC equipment from TSMC fabs is a positive for Lam Research.

$LRCX https://t.co/nefzmJEALB

Interesting.

Nikkei reported that in order to receive U.S. subsidies, TSMC decided not to use Chinese equipment at its Taiwan fabs, rather than removing Chinese equipment from its U.S. fabs.

This will be a major blow to AMEC. https://t.co/OO9hpqRD4E


Summary: NVIDIA pulling forward Rubin platform schedule at TSMC signals accelerating demand; bullish for both NVDA and TSM.

NVIDIA REQUESTED TSMC TO MOVE UP THE RUBIN PLATFORM SCHEDULE

$NVDA $TSM


Summary: Long CDNS in context of TSMC leveraging AI to improve chip energy efficiency tenfold.

At the Open Innovation Platform Ecosystem Forum held in Silicon Valley, TSMC announced that by leveraging AI technology in semiconductor design, it has improved chip energy efficiency by about tenfold. (Economic Daily News, Taiwan)

https://t.co/qnBix5mwf3

Long $CDNS


Summary: Goldman reiterates Buy on Elite Material; expects EMC to capture 40–45% of AI GPU CCL TAM in Rubin generation with 100% Switch Tray share, dismissing market-share loss fears.

250904_Elite Material: Rubin CCL upgrade is in-line with our expectation, where EMC should benefit the most; re-iterate Buy - Goldman Sachs

(1) According to our recent channel checks, Vera Rubin’s Computing/Switch Tray has been confirmed as follows:
■ Computing Tray: M6/M8.5 CCL + HVLP-4 copper foil
■ Switch Tray: M9-class CCL

(2) We maintain our Rubin CCL TAM forecast at $275mn in 2026 and $2bn in 2027.

(3) Here, EMC is expected to capture 40–45% market share of AI GPU CCL TAM.
■ Computing Tray: 15% in M8.5
■ Switch Tray: 100% in M9

(4) This figure is even higher than EMC’s GB300 market share of 35% [AI rack-level CCL revenue].

(5) In addition, another high-power consumption version of AI GPU appears to be at the sampling stage within the supply chain, which could lead to additional CCL upgrade demand in the mid-to-long term.

(6) Furthermore, Rubin’s H/W design is still only in the early stages, and based on past cases, the final design may change after rack-level testing.

(7) The CCL specifications are expected to be finalized around June–July 2026.

(8) Recently, there has been investor concern that EMC might lose market share in the Rubin generation compared with the Blackwell generation.

(9) This is attributed to the entry of mainland Chinese companies into the supply chain.

(10) However, we judge the downside risk to EMC’s market share to be limited. In particular, EMC secured 70% market share in Switch Tray for GB300, and we expect it to recover to 100% in the Rubin generation.


Summary: Bearish SK Hynix: HBM4 price hike likely only ~10% vs 20–40% expected, while TSMC outsourcing raises costs 30%, crushing profitability.

According to reports from the Korean media, the price increase for HBM4 may be limited to around 10%.

The industry had been expecting an increase of 20–40%.

If the price hike really ends up being only 10%, SK Hynix—which outsourced the base die production to TSMC, raising costs by as much as 30%—would inevitably suffer a blow to its profitability.

---

https://t.co/L4RrJWrwso


Nomura: Raises Samsung's target price; Samsung likely to supply HBM4 to Nvidia in Q2 2026

Summary: Nomura raises Samsung target price; HBM4 Nvidia supply win in Q2 2026 is the bullish catalyst.

Nomura: Raises Samsung’s target price; Samsung likely to supply HBM4 to Nvidia in Q2 2026. https://t.co/e3zlMoX0NK


Seeing statements in the media like "I don't understand why Micron is the cheapest stock in the Philadelphia Semiconductor Index in terms of PER" makes me feel uneasy.

Summary: Bearish Micron: 'cheap on PER' narrative signals memory cycle is near peak, not a buying opportunity.

One piece of wisdom my seniors taught me is this: when memory stocks are described as “cheap on a PER basis,” it usually means the memory cycle is right near its peak.

Seeing statements in the media like “I don’t understand why Micron is the cheapest stock in the Philadelphia Semiconductor Index in terms of PER” makes me feel uneasy.

---

https://t.co/ftcyjck5YL


Rating upgraded (EW → OW), CY26 EPS revised from $9.58 → $10.45, target price $209. With DRAM exposure at 28%, the highest among peers, AMAT is set to benefit most from the memory cycle recovery.

Summary: Morgan Stanley raises 2026 WFE outlook to +10%/$128.3B; upgrades AMAT to OW (PT $209) and LRCX to EW (PT $125) on memory/NAND recovery.

2026 Semiconductor Equipment Market Outlook Raised (Morgan Stanley)

1. Market Outlook
    • The 2026 WFE (Wafer Fab Equipment) market forecast has been revised upward from +5% to +10% growth, with the market size now estimated at $128.3B.
    • Memory is the key driver of the upward revision: DRAM WFE projected at $34.9B (+18%), NAND WFE at $13.8B (+35%).
    • For DRAM, Samsung and SK Hynix’s greenfield investments and strong DDR5/HBM demand are the main catalysts, while NAND is supported by surging eSSD demand (+50% in 2026).
    • Memory supply-demand improvement creates upside risk for memory Capex in 2026/27.

2. Company-Level Changes

1) Applied Materials (AMAT)
    • Rating upgraded (EW → OW), CY26 EPS revised from $9.58 → $10.45, target price $209.
    • With DRAM exposure at 28%, the highest among peers, AMAT is set to benefit most from the memory cycle recovery.
    • Risks related to China and ICAPS (power semiconductors/displays) largely resolved.
    • Currently trading at a 25% valuation discount vs. LAM, but the target price reflects only a 15% discount → room for re-rating.

2) Lam Research (LRCX)
    • Rating upgraded (UW → EW), CY26 EPS revised from $5.12 → $5.43, target price $125.
    • Supported by NAND recovery and non-China logic growth (+16%), WFE is expected to outperform for a third consecutive year.
    • However, with current valuation at 23x already reflecting optimism, further upgrades would require revenue above $24B and EPS above $6.

3. Regional WFE Outlook
    • Korea: $28.2B (+20%), strong growth led by Samsung and SK Hynix.
    • Taiwan: $28.2B (+15%), sustained growth driven by TSMC.
    • China: $39.8B, flat (0% growth) due to U.S. export restrictions.
    • Japan: $11.6B (+10%).
    • North America & Europe: $12.8B and $3.8B respectively, modest growth.

$AMAT $LRCX


Rating upgraded (UW → EW), CY26 EPS revised from $5.12 → $5.43, target price $125.


BROADCOM WINS ORDERS FOR BYTEDANCE'S 2ND-GEN ASIC, APPLE'S CUSTOM ASIC, AND XAI'S CLOUD ASIC

Summary: Shares bullish news of Broadcom winning major ASIC orders from ByteDance, Apple, and xAI.

BROADCOM WINS ORDERS FOR BYTEDANCE’S 2ND-GEN ASIC, APPLE’S CUSTOM ASIC, AND XAI’S CLOUD ASIC

$AVGO

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https://t.co/BDbOIrZt5e


ASMPT has gained traction after winning supply orders with Micron, and SK hynix appears to have decided to reintroduce them… Industry observers expect SK hynix to adopt a dual-vendor model for HBM4 TC bonders, using both Hanmi Semiconductor and ASMPT

Summary: SK hynix reverting to Hanmi as primary HBM4 TC bonder supplier with ASMPT as dual source; Hanwha Semitek losing ground on technical immaturity.

ASMPT listed on Hong Kong Exchange 0522.HK

“Surrender to Hanmi” — SK hynix’s TC Bonder Supply Chain Diversification Stalls

SK hynix is reorganizing its supply chain for TC bonders used in high-bandwidth memory (HBM), but the move is effectively faltering. The company has been pushing to diversify its supply chain away from its long-standing sole vendor model with Hanmi Semiconductor, but with its new partner Hanwha Semitek facing questions over technical maturity, the company is readjusting its strategy. Investment in TC bonders has also slowed, with expected equipment purchases this year likely to shrink to around 80 units, down from the original estimate of 120.

According to industry sources, starting with the next-generation HBM4, SK hynix is considering operating its TC bonder supply chain mainly around Hanmi Semiconductor while also seeking to rekindle cooperation with Hong Kong’s ASMPT. The plan is to strengthen its long-standing partnership with Hanmi while mitigating the risks of having a single vendor through ASMPT rather than Hanwha Semitek.

SK hynix had long received exclusive TC bonder supply from Hanmi Semiconductor but began moving toward vendor diversification last year as part of its risk management strategy. This year, it formally brought Hanwha Semitek into the supply chain, prioritizing its orders and giving the company substantial backing.

The order volume reflected this shift. In March and May, Hanwha Semitek secured three contracts worth a total of 89 billion KRW (including VAT): 23.1 billion KRW on March 14, another 23.1 billion KRW on March 16, and 42.8 billion KRW on May 16. Over the same period, Hanmi Semiconductor received just one order of 42.8 billion KRW, or about half as much. This caused friction between the two companies, as SK hynix allocated more orders to inexperienced Hanwha Semitek than to its established partner.

Recently, however, sentiment has shifted toward giving Hanwha Semitek more time as a latecomer, and SK hynix appears to be stepping back. Hanwha Vision’s semiannual report shows that as of the first half of this year, Hanwha Semitek pledged land and buildings valued at 111.9 billion KRW as collateral to SK hynix. It is unusual for a vendor to provide such collateral to a customer, interpreted as SK hynix putting a safeguard in place for their transactions.

Hanwha Semitek also depends heavily on imported core parts such as TC bonder heads and motors. But its suppliers face capacity shortages, limiting their ability to meet demand. This has further influenced SK hynix’s decision to reinforce its relationships with established vendors as it transitions from HBM3E to HBM4.

To prepare for dual sourcing risks, the company is exploring reinstating ASMPT into its supply chain. ASMPT had previously received orders from SK hynix but deliveries were halted due to delays and stability issues. Earlier this year, SK hynix resumed qualification tests of ASMPT equipment, but progress was slow due to weak data processing speed. Recently, however, ASMPT has gained traction after winning supply orders with Micron, and SK hynix appears to have decided to reintroduce them.

Industry observers expect SK hynix to adopt a dual-vendor model for HBM4 TC bonders, using both Hanmi Semiconductor and ASMPT. SK hynix has not yet passed NVIDIA’s HBM4 qualification test but is expected to gain approval in November. Once it receives the purchase order from NVIDIA, mass production could begin by year-end.

That said, new TC bonder orders for HBM4 will likely be very limited this year. Although forecasts earlier in the year suggested SK hynix would order about 20 units in the second half, current expectations point to much lower volumes. With limited space in its fabs and HBM4 able to run on upgraded HBM3E TC bonders, demand for entirely new machines is minimal.

An industry insider noted, “Even if SK hynix places an order for mass production test equipment in October or November, it will be very small, around four units.” If so, Hanmi Semiconductor is expected to handle three units and ASMPT one.

The insider added, “The price of TC bonders for HBM4 is likely to rise about 40% from the previous generation. Even if upgrades rather than new orders are made, Hanmi Semiconductor is expected to fully reflect these costs.”

---

https://t.co/ynJ51zsqiI


테슬라의 세컨~써드 벤더에서 퍼스트 벤더가 될 것 같은...

Summary: Samsung Electro-Mechanics likely to be upgraded from secondary/tertiary to primary Tesla vendor; implied bullish.

삼성전기 = Samsung Electro-Mechanics, KOSPI 009150.KS

@Alisvolatprop12 테슬라의 세컨~써드 벤더에서 퍼스트 벤더가 될 것 같은...

삼성전기의 폭등 이유

1. 과거 테슬라 HWD에 FC BGA를 공급한 이력 존재

2. 삼성전기는 전장용 카메라 모듈도 다수 공급


There is a statistically significant relationship between low active holdings and future stock performance... Leading indicators of compute demand remain exceptionally strong, with no signs of slowing... we continue to view Nvidia as a high-quality asset in the current AI-dominated era

Summary: Shares Morgan Stanley's bullish NVDA thesis: most underweight large-cap tech stock with strong fundamentals and historically underweight stocks outperform as holdings catch up to index weight.

Surprised? Nvidia is the “most underweight” large-cap tech stock

As the world’s most valuable company and the “leader” of the AI concept, Nvidia has actually become the large-cap tech stock that institutional investors are least willing to overweight.

Morgan Stanley’s latest research shows that although Nvidia has risen to the top as the world’s most valuable company, institutional investors’ actual holdings still significantly lag its market position. Analyst Erik Woodring pointed out in the research report that Nvidia has now become “the most underweight large-cap tech stock.”

Data shows that Nvidia’s weight in the S&P 500 Index has reached 7.37%, but its share in institutional investors’ average portfolios is only 4.2%, leaving an adjusted underweight gap of as much as 2.41 percentage points. This gap ranks first among the 15 major tech companies tracked by Morgan Stanley.

Analysts believe that this mismatch between holdings and index weight highlights Nvidia’s unique position. Although the stock has surged nearly 1,300% over the past five years on the back of the AI boom, its rapid rise, along with geopolitical and supply chain-related risks, has caused some investors to remain cautious about significantly increasing their holdings.

Among other large tech stocks tracked by Morgan Stanley, Microsoft, Apple, and Amazon are also underweight, though to a lesser extent than Nvidia. Microsoft is underweight by 2.39 percentage points, Apple by 1.66 percentage points, and Amazon by 1.40 percentage points.

In contrast, institutional investors are overweight in certain tech stocks. Intuit is overweight by 0.83 percentage points, Oracle by 0.32 percentage points, and Dell by 0.25 percentage points.

Historical experience shows that underweight stocks often perform better over time, as investors gradually increase their holdings to match their index weight. Analysts said: “There is a statistically significant relationship between low active holdings and future stock performance.”

Fundamentals remain solid
Despite being underweight, Morgan Stanley analysts remain optimistic about Nvidia’s fundamentals. In the report, analysts wrote:

“Leading indicators of compute demand remain exceptionally strong, with no signs of slowing. As supply chain constraints on rack-level solutions gradually ease, and with the U.S. government advancing export license approvals for China, we continue to view Nvidia as a high-quality asset in the current AI-dominated era.”

Nvidia’s stock has risen 35% over the past year, outperforming the S&P 500 Index’s roughly 10% gain. Market optimism is mainly driven by demand for its graphics processing units (GPUs), which are widely used in AI and cloud enterprise applications.

However, not everyone agrees with the optimistic outlook for large-cap stocks. Apollo Management’s chief economist Torsten Sløk previously stated that the current valuations of large-cap tech stocks and the overall index may be difficult to sustain. He noted that the price-to-earnings ratios of the top 10 companies in the S&P 500, including Meta and Nvidia, have already exceeded the levels seen during the 1999 internet bubble.


Summary: Bullish WDC: all-time-high HDD demand enabling immediate price increases across all capacities.

WDC

- As demand for all capacities reaches an all-time high, the company will gradually raise prices for all HDD products, effective immediately.


Summary: JPMorgan shared/adopted: TSM +3-5% near-term on strong Q3 guidance/margins, then range-bound 2-3 months on conservative Q4 outlook; 2025 EPS raised ~3-5%.

TSMC - JP Morgan

TSMC's Q2 2025 earnings announcement showed profitability and operating profit margins exceeding market expectations. The company's performance was robust, particularly due to high margins and non-operating income, despite foreign exchange headwinds. The Q3 2025 guidance was set at approximately an 8% increase quarter-over-quarter, which is higher than our firm's estimated 4% increase. This performance improvement was primarily driven by seasonal demand from smartphones, while the HPC segment is expected to remain flat after a surge in the first half of the year. The gross margin guidance of around 56.5% also indicates sound profitability despite the strong appreciation of the New Taiwan Dollar. A positive outlook is maintained for data center AI demand, and CoWoS supply shortages are expected to persist until 2026.

TSMC upgraded its full-year 2025 revenue guidance to roughly 30% growth, but anticipates Q4 2025 revenue to decline by approximately 10% quarter-over-quarter. This is a significant decrease even considering typical seasonality. JPMorgan analyzes this as a result of conservative assumptions regarding tariff impacts and the pulled-forward demand from Q2 and Q3. In terms of long-term growth, the N2 process and AI demand were cited as key drivers, with the ramp-up of N3 and N2 nodes at the Arizona fab also accelerating. Particularly, N2 is experiencing strong demand from both HPC and AI, with wafer input expected to begin by the end of 2025 and revenue to fully materialize by mid-2026. The average selling price (ASP) in Q2 increased by 16% year-over-year, and double-digit ASP growth is projected to continue in the future.

However, the Q4 revenue guidance reflects a sharper decline than expected, and demand recovery in non-AI segments remains weak. The effect of China's consumer subsidies may also be short-lived, and a somewhat cautious tone was observed regarding expansion plans in Japan and Europe. Capital expenditure plans beyond 2026 were not specified, and the company is assessed to have taken a more conservative stance than market expectations. This presents a slight disconnect with the strong anticipation for N2 process expansion.

JPMorgan expects to upgrade its 2025 earnings forecast by about 3% to 5% based on this announcement, but a significant upward revision of profit forecasts will be challenging until the extent of the Q4 earnings decline becomes clear. In the short term, the stock price may rise by 3% to 5%, reflecting the strong Q3 revenue growth guidance and robust margin outlook. However, due to the conservative Q4 guidance, the stock is likely to trade within a narrow range for the next two to three months.

$TSM


The CoWoS allocation for AMD's AI accelerators in 2026 is double that of 2025.

Summary: Bullish AMD: CoWoS packaging allocation for AI accelerators doubling from 2025 to 2026, signaling strong demand ramp.

I’d like to draw attention to AMD in this chart.

The CoWoS allocation for AMD’s AI accelerators in 2026 is double that of 2025.

$AMD https://t.co/AtdU4XtlaQ

Morgan Stanley's Detailed Analysis of the TSMC CoWoS Capacity Battle: NVIDIA Secures 60%, Cloud AI Chip Market to Surge 40-50% by 2026

According to a recent research report from Morgan Stanley, a detailed forecast has been released regarding the allocation of CoWoS capacity https://t.co/unpdIBsicl


Summary: HSBC initiates CoreWeave with Reduce, PT $32 (77% downside); DCF shows excessive expectations, weak FCF, high leverage, customer concentration risk.

HSBC has set a price target of $32 for CoreWeave.

HSBC's Investment Opinion: Initiating Coverage with 'Reduce'
Target Price: $32.00 → Represents a 77% downside from the current stock price of $140.59.

According to DCF-based valuation, the current stock price reflects excessive expectations.

Key Investment Summary
1. Business Overview and Market Position
CoreWeave is an AI-specialized GPU cloud infrastructure company, deploying over 250,000 Nvidia GPUs across 32 data centers in North America and Europe.

Key Customers:
Microsoft (62% of 2024 revenue, 72% as of 1Q25)
OpenAI (Total contract value of approximately $15.9B, but no upfront payments)
Nvidia (Approximately 4% of 2024 revenue)

2. Growth and Outlook

The GPU cloud market is projected to grow at a CAGR of 55% from 2024-27, reaching a market size of $200B by 2027.

CoreWeave is expected to expand its market share from 4% in 2024 to 9% by 2027 in this market.

However, cash flow (FCF) and profitability are weak, specifically:
EBITDA margin consensus is 10%p lower than estimated for 2025-30.
Maintenance CAPEX is expected to increase (reaching 35% of revenue after 2030).
Net debt/equity ratio is projected to approach 10x after 2025.
Covenant breach risk in 4Q25.
Structural Risks and Rationale for Investment Opinion

1. Customer Concentration and Commoditization Risk

Microsoft and OpenAI account for most of the revenue → significant risk if customer diversification fails.

Neither company uses CoreWeave's software stack, meaning no customer lock-in effect.

Microsoft is only using bare metal; contract termination is possible if GPU supply improves.

OpenAI's contract is large, but risk is shifted without upfront payments.

2. High Funding Costs and Financial Leverage

Average interest rate of 13% in 1Q25 (including estimates).
Low credit ratings of customers other than Microsoft → increased equity contribution required for SPV formation.
Needs to raise $42B in funding from 2025 to 2030, which cannot be covered by internal cash flow.

Based on cash and remaining credit, an additional $7.6B is needed for 2025 alone.

3. Structural Limitations of GPU Cloud

GPU cloud is difficult to differentiate from general CPU cloud (low software demand and intensified price competition).

Lower asset turnover ratio compared to AWS and Azure (CRWV: 32%, AWS: 76%).
Very high depreciation expense (54% of total operating expenses as of 1Q25).

4. Intensified Competition

Fierce competition with Oracle, Lambda Labs, Crusoe, Applied Digital, Nebius, etc.

Nvidia prioritizes GPU allocation to these Neoclouds, encouraging competition → supplier (Nvidia) has superior bargaining power.

Price competition is inevitable: Operating at prices 30~50% cheaper than Hyperscalers.

Key Financial Estimates (HSBC Basis)

Revenue
2024: $1,915 million
2025e: $5,010 million
2026e: $11,385 million
2027e: $18,054 million

EBITDA
2024: $1,188 million
2025e: $2,819 million
2026e: $6,891 million
2027e: $10,983 million

Net Income
2024: -$863 million (Net Loss)
2025e: -$624 million (Net Loss)
2026e: -$305 million (Net Loss)
2027e: $733 million (Expected to turn profitable)

Free Cash Flow (FCF)
2024: -$5,953 million
2025e: -$17,739 million
2026e: -$5,405 million
2027e: -$4,505 million (FCF is projected to remain negative through 2027.)

Net Debt
2024: $6,153 million
2025e: $22,665 million
2026e: $28,070 million
2027e: $32,575 million (Net debt is projected to increase significantly and continuously.)

ROE (Return on Equity)
2024: -11.0%
2025e: -21.2%
2026e: -9.2%
2027e: 27.4% (ROE is only expected to turn positive after 2027.)

Net Debt/Equity
2024: 4.7x
2025e: 8.1x
2026e: 11.0x
2027e: 9.6x (This ratio remains very high, indicating substantial financial leverage.)

HSBC Conclusion
FCF positive conversion is difficult even in the long term.

Depreciation and replacement costs of GPU assets will erode real profitability.

The stock price reflects overly optimistic expectations, and the DCF-based value is around $32.


Summary: Bullish DRAM: DDR4/DDR5 at all-time highs driven by HBM supply shift, AI demand, and restocking; may signal a structural industry upcycle.

Long-Term Trend of DRAM Spot Prices (2000–2025)

    • The current mainstream products, 16Gb DDR5 is priced around $7, and 16Gb DDR4 is around $10, reaching all-time high levels.

    • This surpasses the previous price peaks seen in past DRAM cycles (early 2000s, 2017–2018).

    • Compared to the 2023–2024 trough (DDR5 at around $4, DDR4 at $2.5–3.5), prices have more than doubled, confirming a strong upcycle.

    • The sharp price increase is driven by:

① Supply shortages of DDR5 due to memory makers shifting production to HBM

② Server and PC replacement cycles alongside expanding AI-related demand

③ Restocking of channel inventories

    • From a historical perspective, it is rare for mainstream DRAM product lines to simultaneously reach new peaks, which may indicate a potential structural shift in the industry cycle.


GB200 to Rubin and VR200 progressing smoothly overall... target of delivering just over 30,000 GB racks in 2025 remains unchanged... further expanding Nvidia's competitive advantage

Summary: Shares GF Securities Buy on NVDA (GB200 yield improving, Rubin ahead of schedule) and Hold/downgrade on AMD (MI355 demand disappoints).

GF Securities’ comments on GB200/GB300 production:

GB200 to Rubin and VR200 progressing smoothly overall: According to exchanges during SEMICON Taiwan, despite concerns about GB200 production issues, we observed that major ODMs’ first-pass yield has improved from 84–85% in June to around 90% in September, indicating that the target of delivering just over 30,000 GB racks in 2025 remains unchanged. We expect production to ramp to 11,000 units in 3Q25 and 16,000 units in 4Q25. In 2026, we anticipate GB300 will become the main product, with performance far surpassing competitors, consistent with our previous downgrade report on AMD (Hold), which cited lower-than-expected demand for the MI355.

As for Rubin, the next key milestones are the status of collaboration with Jentech (3653 TT) on the micro-channel lid and TSMC’s packaging progress in mid-November, both of which are currently proceeding smoothly. We expect Rubin packaging to be completed ahead of schedule by mid-2026, further expanding Nvidia’s competitive advantage.

$NVDA $AMD

轉

廣發海外電子通信》英偉達 (NVDA Buy) 季中更新，近期參訪要點


consistent with our previous downgrade report on AMD (Hold), which cited lower-than-expected demand for the MI355

轉

廣發海外電子通信》英偉達 (NVDA Buy) 季中更新，近期參訪要點


Summary: MediaTek winning Meta's Arke ASIC order signals growing CSP revenue from 2026+; Broadcom retains dominant position across major CSP clients.

Report: MediaTek Wins Major Order for Meta's New 2nm ASIC, Aiming for Mass Production in H1 2027

MediaTek and Broadcom are in continuous competition for Meta's new Application-Specific Integrated Circuit (ASIC) projects, with industry sources emphasizing that their performances are neck and neck. However, recent reports suggest that MediaTek is poised to win a major order for one of Meta's upcoming 2nm ASICs, codenamed "Arke." This chip, focused on post-training and inference, is expected to enter mass production in the first half of 2027.

IC design industry sources reveal that if MediaTek wins the competition for this product, it would be the company's second major order from a Cloud Service Provider (CSP) client. MediaTek has traditionally refrained from commenting on any ASIC client-related news and maintains the same position on this matter.

According to sources familiar with the ASIC industry, the "Arke" chip was not actually part of Meta's initial roadmap. Following "Iris," which is scheduled for mass production at the end of 2025, the original plan was to launch another product, "Olympus," using the N2P process.

However, considering practical needs and cost-effectiveness, a chip specifically for inference, "Arke," was added to the product launch schedule. "Olympus" will now be repositioned as a training-focused ASIC to compete with NVIDIA's future GPUs, and its launch schedule will also be pushed back to 2028.

Of course, the timelines for both "Arke" in 2027 and "Olympus" in 2028 will ultimately depend on actual market conditions.

Meta's previous products, and even the postponed "Olympus," were reportedly all handled by the ASIC market leader, Broadcom. However, a cooperative relationship already exists between MediaTek and Meta. Meta's previously promoted proprietary smart glasses chip was a collaborative effort with MediaTek, establishing a working foundation between the two in the ASIC field.

Therefore, it is not entirely surprising that MediaTek is expected to gain Meta's favor with the new "Arke" chip.

Industry insiders state that after securing Google as a major client, MediaTek indeed needs to broaden its collaborations to establish its influence in the cloud ASIC market.

The market has also recently observed that the design roadmaps and plans of major CSPs for ASICs are diverging from previous patterns. Although the demand for cloud AI remains immense and supply is extremely tight, the attitude of major CSPs towards cost-effectiveness has shifted.

Previously, the primary consideration was whether the technology met the requirements and could be integrated; technical specifications and launch speed were prioritized, with cost being a much lower consideration.

The situation is different now. As CSPs gain a clearer understanding of the actual cloud AI market dynamics and the technical details of chip design, they are beginning to seek the development of more practical and cost-effective products. It is in this environment that MediaTek's advantages in cost control are becoming more apparent.

For the publicly announced ASIC projects by major CSPs and key AI players, the furthest mass production plans currently extend to around 2028. The winners for most of these projects have already been decided, with only a very small number of deals yet to be finalized.

Currently, Broadcom remains the biggest winner, securing substantial projects from not only Google and Meta but also other key players like OpenAI, Apple, and ByteDance. However, MediaTek has successfully carved out a niche with Google and Meta, two clients where Broadcom previously held a dominant position. It is anticipated that as mass production for its major CSP clients' products accelerates from 2026 onwards, there will be a significant contribution to MediaTek's revenue.

---

https://t.co/c4Hwr2Em8F


Broadcom remains the biggest winner, securing substantial projects from not only Google and Meta but also other key players like OpenAI, Apple, and ByteDance


Summary: Shares CLSA initiation on Micron with $155 PT; bullish on HBM ramp, rising ASP through 2026, margin expansion from HBM mix.

250827_Micron: Riding the crest of the AI wave - CLSA

[Key Takeaways]

(1) CLSA initiates coverage on Micron. Target at 2.4x 2026E BPS. Target price $155

(2) Expects ASP to rise through 2026, driven by strong HBM growth based on robust AI CAPEX and limited supply of commodity DRAM products

(3) Forecasts mass production of HBM4 to begin in the second half of 2Q26, with margin improvement expected from the increasing revenue mix of HBM

[Contents]

(1) Global AI infrastructure investment growth is driving HBM demand

(2) In 2025, Micron’s HBM3E 12-hi output is ramping faster than expected, proving strong execution by supplying to four major customers

(3) Micron is currently undergoing HBM4 qualification testing, with mass production scheduled to begin in the second half of 2Q26

(4) We expect Micron’s HBM revenue mix within DRAM to rise from 21% in 2025 to 31% in 2026 and 39% in 2027. Accordingly, margin improvements will also appear

■ HBM Rev: ’24(A) $0.6bn → ’25(F) $7.8bn → ’26(F) $13.7bn → ’27(F) $20.1bn
■ HBM Mix: ’24(A) 3% → ’25(F) 21% → ’26(F) 31% → ’27(F) 39%
■ HBM M/S: ’24(A) 6% → ’25(F) 21% → ’26(F) 25% → ’27(F) 28%
■ TSV CAPA: ’24(A) 25K → ’25(F) 65K → ’26(F) 95K
(5) Micron has secured about 25% market share within NVIDIA. However, Samsung Electronics is expected to expand its share, and Micron’s is projected to decline to around 20% in 2026

(6) Nevertheless, Micron is expected to offset this through transactions with major ASIC customers

(7) Meanwhile, we forecast global HBM revenue to grow at a CAGR of +35% through 2030, reaching around $105bn, or about 46% of total DRAM revenue mix

(8) As for commodity products, due to low inventory levels at both memory suppliers and customers, we forecast strong DRAM ASP from 2H25 through 2026

(9) In 1H26, DRAM ASP may weaken slightly due to seasonal low demand, but the downtrend is expected to be short-lived, given tight supply and low inventories

(10) All memory IDMs remain focused on HBM CAPA. Since HBM products consume 3–4x more wafer input than standard products, supply remains tight, which will continue to support ASP for commodity products

(11) For NAND, suppliers’ restrained CAPEX stance and controlled supply are leading to a gradual recovery

(12) Demand for data center eSSD is rebounding, and content growth is expected to increase as AI features are increasingly adopted in smartphones and PCs

$MU


Summary: Shares Citi Buy-thesis on Amazon: above-consensus Q2 + H2 AWS re-acceleration, Prime Day retail rebound, ad margin expansion, and OP beats drive sustained upside.

Amazon Outlook: AWS Growth to Drive H2 Acceleration, Retail and Advertising Margins Continue to Improve
Citi (R. Josey, 25/07/22)

Citi believes Amazon will deliver better-than-expected revenue and operating profit performance in its Q2 2025 earnings report, with a key focus on the uplift from AWS infrastructure deployment for second-half growth. Meanwhile, Prime Day is expected to drive a retail rebound, strong advertising demand, and improved operational efficiency, all contributing to margin expansion.

AWS Infrastructure Deployment Lays Foundation for H2 Growth

Citi expects Q2 2025 AWS revenue to grow 16.5% year-over-year, slightly below buyer expectations of 17%, but emphasizes that management's commentary on second-half growth is more crucial. Especially with sustained GenAI demand and the Anthropic contract expanding to $4 billion ARR, AWS is poised for re-acceleration. A significant portion of the approximately $74 billion in 2025 CapEx will also be allocated to AWS infrastructure construction.

Retail Demand Rebounds, Prime Day Provides Additional Growth Momentum

Prime Day's contribution to retail growth is over 500 basis points, with total retail revenue expected to grow +9% year-over-year in North America and +11% internationally. Citi credit card data shows continued acceleration in "multi-category store" spending in Q2, with year-over-year growth rising to 13.4% in mid-July, confirming the trend of rebounding consumer momentum.

Advertising Business Continues Strong Growth, Driving High-Margin Structure Improvement

Q2 2025 advertising revenue is expected to grow 17.5% year-over-year, excluding currency effects. Channel checks indicate strong demand for Sponsored Listings, Prime Video, and DSP advertising. Notably, partnerships with Roku and Disney have expanded advertising distribution channels, with the advertising business providing a substantial boost to overall margins.

Operating Profit Continues to Exceed Upper Guidance, Operational Efficiency Continues to Improve

Citi forecasts Q2 2025 operating profit at $17.1 billion, with a margin of 10.5%, close to the upper end of guidance. Amazon has exceeded the high end of its guidance by over $1.2 billion in six of the past eight quarters. Operating cost control is good, with automation deployment (such as Vulcan robots) improving efficiency. Coupled with the increasing proportion of advertising and AWS, these factors jointly drive continuous improvement in profitability.

North American Retail Margins Gradually Expanding, Long-Term Trend Optimistic

While Citi conservatively estimates that North American retail (excluding advertising) margins will only reach 5% after 2030, there has been positive progress, including $4 billion investments in suburban fulfillment centers and robot deployments exceeding the number of warehouse employees. These measures are expected to drive continuous upward operational efficiency. Even with additional costs from the Kuiper project, overall retail margins are likely to continue improving.


Samsung's cooperation with Intel perfectly aligns with Trump's 'Save Intel' policy… closer collaboration with Intel could further accelerate this momentum

Summary: Samsung–Intel foundry/packaging alliance aligns with Trump policy and could accelerate both companies' pursuit of TSMC, bullish for both names.

Samsung–Intel Foundry Alliance Pursuit: From Packaging to Glass Substrates to Catch Up with TSMC

As Samsung Electronics Chairman Lee Jae-yong visits the United States as part of the economic delegation to the Korea–U.S. summit, speculation is growing that Samsung is actively pursuing a strategic alliance with Intel to strengthen its foundry business.

It is reported that Samsung is considering investing in the packaging sector, where Intel holds relative strengths, and utilizing Intel’s packaging production lines in the U.S. Samsung is also said to be reviewing ways to leverage Intel’s semiconductor glass substrate technology.

Samsung Electronics has already invested $37 billion (about ₩51 trillion) to build a foundry plant in Taylor, Texas, and has been reviewing additional U.S. investments. Analysts suggest the company may be pushing for packaging production line investments in cooperation with Intel.

According to semiconductor industry reports compiled on the 26th, Samsung Electronics is expected to tighten its pursuit of Taiwan’s TSMC, the global foundry market leader, by strengthening post-process packaging cooperation with Intel.

An industry insider said, “Samsung Electronics is deliberating the possibility of a strategic partnership with Intel, most likely in the packaging field,” adding, “Intel has strengths in packaging and is also ahead in glass substrate technology.”

Foundry processes are divided into the front-end (fabricating circuits on wafers) and the back-end (packaging and testing the fabricated chips). While Samsung Foundry is considered ahead of Intel in front-end technology, Intel holds advantages in back-end packaging.

Samsung Foundry has mostly outsourced wafer packaging and testing to OSAT (Outsourced Semiconductor Assembly and Test) companies after front-end wafer production. TSMC also collaborates with Taiwanese OSAT companies, but it possesses the industry’s leading back-end packaging technology.

The “Chip-on-Wafer-on-Substrate (CoWoS)” technology, which became famous for use in Nvidia AI semiconductors, is one of TSMC’s flagship packaging technologies. Intel is also evaluated as having strengths in post-process packaging, alongside TSMC.

A source familiar with Intel noted, “The core of the Samsung–Intel cooperation will be packaging,” adding, “Intel Foundry is applying hybrid bonding packaging technology to its 18A (2nm-class) process production. While it lags in front-end node technology, it has a clear advantage in packaging.”

Hybrid bonding is a packaging technology that stacks chips through copper interconnections without “bumps” between chips. Although it is not yet used in memory semiconductors such as HBM (High Bandwidth Memory), Intel and TSMC already use this technology in packaging CPUs and image sensors (CIS).

In market share calculations that only account for front-end foundry processes, Samsung ranks second after TSMC. However, when including both front-end and back-end processes, Intel surpasses Samsung.

According to Counterpoint Research’s Q1 2025 revenue-based integrated market share survey (front- and back-end combined), TSMC ranks first with a 35.3% share, Intel is second at 6.5%, and Samsung is fourth with 5.9%, behind Taiwanese back-end firm ASE.

Observers believe Samsung and Intel’s cooperation could extend to next-generation semiconductor “glass substrates.”

Glass substrates are drawing attention for high-performance AI semiconductors due to smoother surfaces, lower coefficients of thermal expansion, higher thermal stability, thinner thickness, and improved electrical performance compared to conventional plastic substrates.

An industry official said, “Intel has recently shifted its glass core substrate (GCS) technology into a licensing model to generate revenue,” adding, “After more than a decade of developing glass substrates, Intel’s move to open up the technology makes cooperation with Samsung all the more feasible.”

Samsung Electro-Mechanics recently hired Kang Doo-an, a former senior engineer at Intel who worked extensively on glass substrates, as Executive Vice President overseeing technology marketing and application engineering. Kang is tasked with analyzing packaging technology for the semiconductor glass substrate market and establishing R&D strategies at Samsung Electro-Mechanics.

Samsung–Intel foundry cooperation is seen as a potential Korea–U.S. semiconductor collaboration model aimed at catching up with TSMC, which controls more than 70% of the global market.

The cooperation between Samsung and Intel could take the form of equity investments or a joint venture (JV), where both sides contribute capital, technology, and manpower for specific business purposes.

Singapore-based investment media outlet Smartkarma reported, “From a political standpoint, Samsung’s cooperation with Intel perfectly aligns with Trump’s ‘Save Intel’ policy,” adding, “Samsung’s 2nm AI6 order from Tesla was already a groundbreaking step, and closer collaboration with Intel could further accelerate this momentum.”

$INTC

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https://t.co/msTikUVXWd


Samsung–Intel foundry cooperation is seen as a potential Korea–U.S. semiconductor collaboration model aimed at catching up with TSMC


Summary: Goldman raises AI server ABF TAM 35-55%; Unimicron, NYPCB top beneficiaries on ASIC share gains; Ibiden entering high-end ASIC substrates from early 2026.

Unimicron Technology listed on TWSE as 3037.TW

ABF: ASIC Servers to Become Key Growth Driver, Material Shortage Supports Price Outlook
Goldman Sachs (C. Wang, 07/08/25)

Goldman Sachs is raising its 2026/27 Total Addressable Market (TAM) forecast for the AI server ABF (Ajinomoto Build-up Film) market by 35% and 55%, respectively. The core logic is the strong demand for ASIC AI servers and their higher Average Selling Price (ASP) compared to GPU AI substrates. Unimicron and Nan Ya PCB (NYPCB) are expected to benefit the most due to their focus on high-end ASIC customers, with their long-term revenue share from this segment significantly revised upwards.

Raised Forecasts for AI Server ABF Market and ASIC Shipments
The 2026/27 shipment forecast for ASIC AI server substrates is 3.4 million and 4.7 million units, respectively, with corresponding ASPs of $180 and $220. These ASPs are higher than those for GPU AI substrates ($143 and $183, respectively). Unimicron and NYPCB's key customers include Broadcom, Alchip, Marvell, and others. It is projected that by 2027, the revenue share from AI servers for these two companies will reach 16% and 20%, respectively, up from previous estimates of 13% and 12%.

Ibiden Poised to Enter the High-End ASIC Substrate Market
Leveraging its technological leadership and a 40% capacity expansion plan, Ibiden is expected to increase its ASIC substrate revenue starting from early 2026, with a focus on the ultra-high-end segment (e.g., substrates with embedded components).

T-glass Material Shortage Pushes Prices Upward
Goldman Sachs believes that lead times for high-end ABF substrates may be extended, and prices are expected to be raised during contract negotiations from late September to early October. Although the capacity utilization rate is only projected to be around 75% for the period from 2H25 to 1H26, which may limit the earnings boost from price hikes after 2H26, it will still have a positive short-term impact on manufacturers' performance.


Nan Ya PCB (NYPCB) listed on TWSE as 8046.TW


Ibiden is expected to increase its ASIC substrate revenue starting from early 2026, with a focus on the ultra-high-end segment

Ibiden Co. Ltd 4062.T Japan ABF substrate


Summary: Long King Yuan (2449.TW): rumored to have locked in burn-in test deal with Nvidia for Rubin, with August order price hikes.

structural marker; pre-classified as canonical yfinance ticker

Rumor: King Yuan secured the burn-in test equipment deal with Nvidia, beating out Advantest.

轉傳

測試設備
京元電（2449）預計8月份就會跟輝達完成簽約
同樣的京元電在這次Rubin晶片依然拿下全部的測試訂單
對手日月光burn-in測試不順、加上愛德萬burn-in機台沒有通過NV認證，目前在老化測試跟FT還是京元電獨拿

由於老化測試產能嚴重不足
從公司的說法來看
京元電8月份訂單全面漲價


Data Center Compute revenue (ex-China) expected to grow +17% QoQ vs. +19%... Vera Rubin is on track as planned; 'Scale Across' could emerge as a new competitive edge... GPM will recover to mid-70% levels by year-end

Summary: Bullish NVDA: data center compute growing +17% QoQ ex-China, Rubin on schedule, GPM recovering to mid-70s, strong demand from hyperscalers and sovereigns.

250909_NVIDIA: Communacopia + Technology Conference 2025 - Goldman Sachs

[Key Takeaways]
(1) Data Center Compute revenue (ex-China) expected to grow +17% QoQ vs. +19%
(2) Vera Rubin is on track as planned; “Scale Across” could emerge as a new competitive edge
(3) Strong demand not only from hyperscalers but also from non-traditional customers, including sovereigns
(4) Shipment timing for China-related products remains somewhat uncertain

[Contents]

(1) AI CAPEX

- AI infrastructure investment to reach $3 trillion by 2030

- Key drivers: 1) Hyperscalers, 2) Non-traditional customers

(2) Near-term Business

- Ex-China, Data Center Compute revenue expected to grow +17% in CY3Q25(F) [an upturn vs. +12% growth in the prior quarter]

- Rubin family remains on schedule, with mass production slated for mid-2026

(3) China Business

- EVP Kress noted that NVIDIA has secured H20 shipment licenses for several major customers in China

- However, due to political uncertainty, actual shipment timing is unclear; if resolved, shipments could contribute $2–5bn revenue in 3Q

(4) Competitive Landscape

- Strong emphasis that Training and Inference are not necessarily separate workloads

- To enable accurate responses and Agentic AI, continued compute resources are required not only for inference but also for post-processing [tuning/adaptation/reinforcement, etc.]

(5) Product Launch Cycle

- NVIDIA’s annual product launch cycle delivers new models and connectivity solutions, providing customers with economic benefits

- Six chips comprising the Rubin architecture have already taped out; “Scale Across” will be a new source of competitive strength for Rubin going forward

(6) Financials & Capital Allocation

- Reaffirmed that GPM will recover to mid-70% levels by year-end

- Plans to continue share buybacks/cancellations, while also investing in ecosystem partners such as technology innovation companies

$NVDA


Summary: Bearish SK Hynix: Goldman sees significant HBM ASP decline in 2026 due to intensifying competition and unsustainably high margin structure.

Goldman Sachs) A frequent question I get is, 'Why are semiconductor equipment stocks (semicaps) underperforming when AI is so hot?' Simply put, AI's contribution to semiconductor equipment companies' earnings is not yet large enough. Furthermore, it's not driving the transition to leading-edge processes (Nvidia's latest Blackwell GPU architecture uses a 4nm process).

On top of this, Intel did not stick to its previous stance on the 14A (1.4nm) process in its earnings announcement (previously, there were observations that it might transition to 14A to regain momentum), and combined with Samsung's struggles, TSMC has become the only alternative in AI chip manufacturing. (For reference, Samsung recently succeeded in winning the order for Tesla's next-generation AI6 chip, presumed to be 2nm). When Elon Musk tweeted, "To accelerate progress, I will personally oversee the production line, and conveniently, the fab is not far from my house," I wonder if they knew what was coming. 😉

---

Goldman Sachs) Speaking of semiconductor equipment stocks, our report on SK Hynix published last week garnered a lot of attention. This was because Goldman Sachs (GS) pointed out the risk of HBM price declines in 2026. There's an interesting point in the analysis from Goldman Sachs Research (GIR). SK Hynix did not provide specific guidance (earnings forecasts) for 2026 (Note: SK Hynix already mentioned in May 2024 that almost all of its 2025 HBM volume was sold out). They only stated that negotiations are proceeding as planned and that they are currently discussing product mix and pricing with customers. We continue to believe that "due to intensifying competition and an unsustainably high margin structure, HBM Average Selling Price (ASP) will decline significantly next year (2026)."


Summary: Sharing Digitimes report: Micron halting quotes ahead of broad NAND/DRAM price hikes up to 30%, signaling new memory upcycle into 2026; bullish for MU.

Exclusive: Micron halts NAND and DRAM quotes after SanDisk price hike, sharper increases looming- Digitimes

Memory manufacturers are swiftly following SanDisk's announcement of a 10% price increase for NAND products, signaling a broader industry move toward higher pricing amid expected supply shortages starting in 2026. Micron has paused NAND Flash and DRAM pricing quotes for a week, while market sources anticipate potential NAND Flash price rises of up to 30%.

Industry insiders indicate that Micron's pricing suspension and rumored sharp price hikes are tied to anticipated growth in CSP's storage needs beginning in 2026. Though consumer demand remains weak, the anticipated surge in data center capacity—especially for AI and enterprise storage—is expected to tighten NAND Flash supplies, initiating a new price increase cycle.

Phison Electronics, a Taiwanese NAND controller manufacturer, has also halted pricing updates pending further direction from NAND suppliers, a move widely interpreted in the industry as an early step in the pricing negotiation process. This coordinated halt signals a consensus on increasing prices, while the precise magnitude of the hikes remains uncertain ahead of the fourth quarter 2025 contract negotiations.

Micron's planned price hikes could significantly surpass the initial 10% level seen with SanDisk, with estimates ranging from 10 to 30%. While some memory module makers expect a 10 to 15% NAND Flash price increase in the fourth quarter, reports from the China market suggest that Micron has hinted at even steeper rises, possibly up to 30%, for storage products. Unlike SanDisk, Micron has not formally notified all customers, indicating these early moves may be testing market responses before finalizing increases.

Price suspensions and hikes extend beyond NAND to DRAM products as well. Taiwanese memory companies report verbal notifications from Micron that DRAM pricing—including DDR4, DDR5, LPDDR4, and LPDDR5—will be suspended for around a week, canceling previously agreed prices. Analysts expect DRAM price hikes of at least 10% based on historical trends, with certain segments such as automotive electronics potentially facing increases as high as 70%.

The broader memory supply chain notes that DDR4 shortages have already driven significant price momentum, with DDR5 prices steadily rising. Expectations are that typical seasonal price slowdowns in late 2025 may give way to sustained or increased pricing pressure, largely fueled by CSP investments in AI ASICs and infrastructure. This demand surge is projected to substantially increase server NAND Flash consumption in 2026, intensifying supply constraints in the second half of next year.

Leading CSPs have reportedly begun negotiating bulk procurement orders for 2026, with data centers placing enterprise SSD orders amounting to tens of exabytes (EB). Given global NAND consumption sits between 800 and 1000 EB annually, and servers accounted for roughly 30% in 2025, a shift toward higher-capacity enterprise SSDs is expected to reshape supply-demand dynamics. This transition is anticipated to boost demand for QLC NAND, a lower-cost, high-density flash technology favored for massive data storage.

Despite the likelihood of continued softness in consumer NAND applications early next year, industry executives remain optimistic about the NAND market's prospects. Khein-Seng Pua, CEO of Phison Electronics, recently noted that the NAND industry is entering a shortage phase in 2026, driven by robust data center and AI usage. Some NAND manufacturers have already begun implementing price increase strategies, while Phison plans to engage closely with the supply chain to maintain stable raw material supplies amid tightening market conditions.

Micron is expected to publish its financial report on September 23, after which it will enter a quiet period and refrain from commenting on market speculation related to its pricing actions. Meanwhile, the developments unfolding across NAND and DRAM suppliers illustrate a supply chain bracing for higher costs and constrained availability that could define the memory market landscape throughout 2026.

$MU

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