Core Insights - Oracle reported strong performance in its cloud business with a backlog of $455 billion in remaining performance obligations (RPO), an increase of $317 billion from the end of last year, representing a year-over-year growth of 359% [2][4] - The growth in orders is primarily driven by data center-related orders from clients such as OpenAI, xAI, Meta, and NVIDIA [2][4] - For FY2026, Oracle's cloud infrastructure IaaS revenue is expected to grow by 77% to reach $18 billion, with projections for the following four years being $32 billion, $73 billion, $114 billion, and $144 billion respectively [2][4] Industry Developments - NVIDIA launched the Rubin CPX GPU, designed to enhance inference performance and efficiency for contexts exceeding 1 million tokens, featuring 128GB GDDR7 memory and AI computing power of 30 PFLOPS [3] - Lixun introduced Co-packaged Copper (CPC) technology at the 2025 Shenzhen Optical Expo, aimed at addressing high-performance, low-cost interconnect challenges in the AI and computing era [3] - Taiwanese AI server ODM manufacturers reported a monthly revenue of NT$121.39 billion in August, a year-over-year increase of 16.71%, with Wistron achieving a remarkable 198.14% increase [4] - China Unicom received a satellite communication business operating license, accelerating the development of satellite internet infrastructure in China [4] - The communication index rose by 3.00% this week, with the Shanghai and Shenzhen 300 index increasing by 1.38%, indicating a relative performance gain of 1.62% [4] Investment Recommendations - The global cloud service provider (CSP) AI arms race is accelerating, with new product launches from companies like Apple and Huawei, and events such as the Open Data Center Conference and META Developer Conference [5] - Continued focus on optical devices and modules, communication equipment, and liquid cooling technologies is recommended [5] - The three major telecom operators remain important assets for dividend allocation, with stable operations and increasing dividend payout ratios [5]

Summary of Key Points from the Conference Call Industry Overview - The conference focused on the AI computing industry, highlighting the significant role of system vendors like NVIDIA and Google in shaping market trends, while TSMC and ASML are pivotal in providing technological platforms [1][2] - Silicon photonics technology emerged as a key topic, aimed at reducing energy consumption unrelated to computation, with large-scale commercialization expected by 2027 [1][2] Company Insights TSMC - TSMC is advancing steadily in its technology, with 2nm process expected to achieve mass production by 2025 and ongoing development of 3nm technology, enhancing its pricing power and customer profitability [1][3] - Under the Foundry 2.0 concept, TSMC's advanced packaging revenue is accelerating, with six operational factories and plans for four new ones, including expansions of CoWoS, SoIC, and CoPoS platforms [1][15] - TSMC's average selling price (ASP) has nearly doubled from $3,000 in 2019 to over $7,000 currently, driven by its technological advantages [13] - Future revenue growth for TSMC is heavily reliant on high-performance computing (HPC) clients, with a 70%-80% growth rate among these customers [16] - TSMC's capital expenditures have increased, with a peak in 2021 at 50% of revenue, but the pressure is expected to ease moving forward [21] Oracle - Oracle's capital expenditures have significantly increased, potentially linked to securing a large order from OpenAI, which could drive additional computing demand [3][19] - If Oracle executes on its projected orders, it could benefit not only itself but also related companies like SoftBank and Industrial Fulian [19] Industrial Fulian - Industrial Fulian is positioned to benefit from the AI-related capital expenditure cycle, particularly in its cloud service equipment segment, which is expected to see rapid growth in 2025 and 2026 [23][24] Market Dynamics - The energy consumption associated with AI development is rising sharply, with cabinet energy consumption projected to increase from 60 kW in 2022 to 120 kW in 2025, and potentially reaching 500 kW by 2027 [10] - New AI chip architectures are emerging, such as 3D stacking and RISC-V based designs, which could significantly impact the market landscape [11] Competitive Landscape - Google and NVIDIA have different approaches in the semiconductor solutions space, with Google utilizing over 9,000 TPUs, while NVIDIA focuses on GPUs [7] - TSMC and ASML are leading the global semiconductor technology landscape, with TSMC introducing GAA technology and ASML advancing EUV lithography [8] Investment Outlook - TSMC is expected to see annual profit growth of 25%-30% in the coming years, with an attractive valuation compared to its peers [4][22] - The semiconductor industry is anticipated to continue evolving, with significant opportunities for companies like TSMC and Industrial Fulian in the AI computing supply chain [25]

S. Y. Hou, TSMC TSMC Property CHIPLETS AND ADVANCED PACKAGING/PHOTONICS Advanced CPO Integrated by CoWoS® and COUPE Advanced CPO Integrated by CoWoS® and COUPE Dr. Shang Y. Hou Director, High Performance Packaging Integration TSMC TSMC Property Outline TSMC Property • Heterogeneous chiplet integration • CoWoS® • COUPE • CPO based on CoWoS® and COUPE • Forward-looking of CPO packaging Technology Advancement for Performance Boost 200 MOS Transistors Cu/Low-K SiGe Immersion HKMG >2000 cores 7B >3000 Cores (16F ...

Core Insights - The semiconductor foundry industry is experiencing significant differentiation, with TSMC dominating the market, capturing 70.2% of global market share in Q2 2025, and achieving a revenue of $30.239 billion, marking an 18.5% quarter-over-quarter increase [1][2][5] - TSMC's success is attributed to its advanced process technologies (3nm, 5nm) and unique packaging solutions, which have positioned it as a critical player in the AI and high-performance computing (HPC) sectors [5][9][11] - Other foundries, such as Samsung, SMIC, and UMC, are facing challenges in maintaining market share and profitability, with Samsung's revenue at $3.159 billion and a market share of 7.3%, while SMIC's revenue declined slightly to $2.209 billion [2][6][12] Industry Overview - The top ten foundries collectively generated $41.718 billion in revenue in Q2 2025, reflecting a 14.6% increase from the previous quarter, indicating a recovery in the semiconductor cycle [2][4] - TSMC's revenue for the first half of 2025 reached $55.6 billion, with a gross margin of 58.7% and a net profit of $24 billion, showcasing its strong financial performance compared to its competitors [5][19] - The foundry landscape is characterized by a "one strong, many strong" dynamic, where TSMC leads while other firms like UMC and GlobalFoundries maintain stability through specialized processes [4][5][6] Trends and Challenges - The industry is witnessing three major trends: AI-driven demand, structural recovery in mature processes, and geopolitical reshaping of global supply chains [8][13] - AI and HPC demand have intensified the focus on advanced packaging, with TSMC being the only supplier capable of large-scale, high-yield CoWoS packaging, which is critical for AI chip production [9][16] - Mature process nodes are undergoing a recovery phase after significant inventory adjustments, with companies like UMC and VIS reporting improved margins due to rising demand in consumer electronics and automotive sectors [12][13] Future Outlook - The second half of 2025 will be pivotal, with TSMC expanding its packaging capacity and Samsung betting on its 2nm technology to regain competitiveness [15][17] - SMIC and other Chinese foundries need to enhance their product mix and manage depreciation pressures to improve profitability, while companies like Huahong and PSMC face challenges in maintaining financial stability [17][18] - The evolving landscape suggests that future winners will be those who can provide comprehensive system solutions rather than just excel in individual technologies [19]

台积电是全球最大的先进芯片生产商，也是英伟达的芯片代工制造商和重要战略合作伙伴，台积电销售 额的激增是AI芯片需求仍然强劲的有力证据。当前AI技术正加快融入千行百业，超大规模AI模型和海 量数据对算力的需求也持续攀升。新应用场景加速发展进一步带动算力需求爆发，AI芯片市场有望迎 接爆发式增长。半导体行业是新一轮科技革命中各国的兵家必争之地，半导体设备作为半导体行业的关 键支撑环节是科技战中的重中之重。中美科技战愈演愈烈，有望催化国产替代加速，国产化率较低的环 节仍有较大替代空间。 ...

Core Insights - TSMC has launched a honey product named "Ji Mi" in collaboration with local beekeepers in Taiwan, showcasing its commitment to sustainability and environmental efforts [1][3] - The company has successfully restored local ecosystems around its manufacturing facilities, evidenced by the return of native species such as silverfish and fireflies [3] - TSMC has achieved significant advancements in resource management, with water recycling rates exceeding 90% in new factories and a waste recovery rate of 97% [4] Group 1 - TSMC's honey product "Ji Mi" is a result of its environmental initiatives and collaboration with local beekeepers [1][3] - The company has conducted environmental research to restore suitable plant species, leading to the return of bees and other native species [3] - TSMC is recognized as the first semiconductor company in Taiwan to have fireflies inhabiting its factory area, indicating a healthy ecosystem [3] Group 2 - TSMC has made significant progress in water resource management, achieving over 90% recycling rates in new factories [3] - The company has minimized waste generation during semiconductor production, with a waste recovery rate of 97% and landfill rates below 1% [4] - TSMC's "zero waste center" in Taichung successfully converts waste into electronic-grade raw materials, supporting the development of a circular economy [4]

Investment Rating - The report maintains an "Outperform" rating for the communication industry [5] Core Insights - Oracle's cloud business shows strong growth with a remaining performance obligation (RPO) of $455 billion, a year-over-year increase of 359% [11][12] - The AI infrastructure sector is rapidly evolving, highlighted by NVIDIA's launch of the Rubin CPX GPU, which enhances performance for large context AI models [26][31] - Taiwanese AI server ODM manufacturers reported a monthly revenue of NT$121.39 billion in August, reflecting a year-over-year growth of 16.71% [34][41] Summary by Sections Industry News Tracking - Oracle's RPO reached $455 billion, up $317 billion from the previous quarter, driven by significant contracts with major clients like OpenAI and NVIDIA [11][12] - NVIDIA introduced the Rubin CPX GPU, designed for high-performance AI tasks, featuring 30 petaFLOPS of computing power and 128GB of GDDR7 memory [26][31] - Taiwanese ODM manufacturers, including Hon Hai and Quanta, reported strong revenue growth, with TSMC's August revenue increasing by 33.84% year-over-year [34][41] Investment Recommendations - Continuous focus on AI computing infrastructure development is advised, with recommendations for companies involved in optical devices and communication equipment [72] - The three major telecom operators are considered important assets for dividend allocation, with stable operations and increasing dividend payouts [72] - Key recommended stocks for the upcoming week include China Mobile, Zhongji Xuchuang, ZTE, and Yinvik [72]

Core Insights - The AI stock market is experiencing momentum despite concerns about sustainability, with three companies identified as strong investment opportunities for the remainder of the year [1][2] Group 1: Taiwan Semiconductor Manufacturing (TSMC) - TSMC is the world's leading semiconductor manufacturer, holding a 67% revenue share of the foundry market as of last year, making it a key player in the AI chip production landscape [4][6] - The company is expected to grow earnings by an average of 21% annually over the next three to five years, with the stock trading at 25 times this year's earnings estimates, indicating potential for further upside [8] - TSMC's strong performance is driven by significant investments in data centers, with trillions of dollars projected to flow into this sector over the next five years [7] Group 2: Alphabet (GOOG) - Alphabet has gained investor confidence following a favorable antitrust ruling that allows it to retain its Chrome browser, which is crucial for its digital advertising strategy [9][10] - The company generated $67 billion in free cash flow over the last 12 months and has $95 billion in liquidity, providing it with substantial investment flexibility [12] - Alphabet's stock is seen as undervalued compared to its peers, with a P/E ratio of 25, and it is expected to benefit from ongoing investments in AI capabilities and share repurchases [11][13][14] Group 3: AppLovin - AppLovin is leveraging AI to enhance its digital advertising platform, with its Axon 2 AI engine launched in 2023 driving significant financial growth [15][16] - The company reported $1.26 billion in revenue for the most recent quarter, a 77% increase year-over-year, and a net income of $0.8 billion, up 164% [16] - Despite a high price-to-sales (P/S) ratio of 37, AppLovin's stock has surged 75% year-to-date and 2,000% since 2022, indicating strong market performance [17][18]

Group 1: Alphabet - Alphabet is trading at a forward P/E ratio of around 22.5 based on 2026 estimates, which is a discount compared to its AI peers despite its diversified business model and strong emerging bets in areas like robotaxis and quantum computing [3] - Concerns that AI would negatively impact Google Search have been alleviated as search revenue growth accelerated last quarter, driven by new AI features that increase user engagement [4][6] - Alphabet maintains a strong distribution edge with Chrome controlling over two-thirds of the browser market and Android powering nearly three-quarters of smartphones, ensuring it remains the default entry point to the internet for billions [5] - The integration of AI into search is enhancing user engagement and monetization, with new features driving incremental queries, particularly with shopping intent, leveraging Alphabet's extensive global ad network [6] - Google Cloud is experiencing significant growth, with revenue soaring 32% last quarter and segment profits more than doubling, positioning Alphabet advantageously in the capacity-constrained cloud computing industry [7] - Overall, Alphabet is considered one of the best megacap tech stocks with substantial potential for further growth at its current valuation [8] Group 2: Taiwan Semiconductor Manufacturing (TSMC) - TSMC is a critical player in the AI space, trading at 23 times 2026 earnings estimates, making it an attractive investment given its role in enabling the AI boom [9] - TSMC dominates the semiconductor industry, manufacturing the majority of advanced semiconductors for leading companies, and has consistently outperformed competitors like Intel and Samsung in terms of yield and scale [10][11] - The demand for AI chips is surging, with Nvidia predicting the AI infrastructure market will reach $3 trillion to $4 trillion in the next five years, and TSMC forecasting a more than 40% CAGR in AI chip demand through 2028 [13] - TSMC's strong pricing power is evident as it plans to raise prices by 10% next year, further solidifying its market position [13] - Beyond AI, TSMC is also poised to benefit from growth in sectors such as autonomous driving, robotics, and quantum computing, making it a top long-term investment in the AI space [14]

Core Insights - The semiconductor foundry industry is experiencing significant differentiation, with TSMC capturing the majority of revenue growth, indicating a recovery from the industry's low point [1][5][34] - TSMC's revenue reached $30.239 billion in Q2 2025, commanding a market share of 70.2%, positioning it as the dominant player in the market [2][6] - The overall landscape shows a trend of "one strong, many strong," with TSMC's advanced processes leading the way while other companies face various challenges [6][14] Company Performance - TSMC's half-year revenue totaled $55.6 billion, with a gross margin of 58.7% and a net profit of $24 billion, showcasing its strong market position [6][19] - Samsung Foundry's revenue for the first half was less than $6.2 billion, with a market share around 7%, highlighting its struggles compared to TSMC [10][27] - SMIC reported a half-year revenue of $4.46 billion, with a gross margin of 21.4%, but faced challenges with high depreciation costs and limited average selling price (ASP) increases [11][30] Market Trends - The demand for AI and high-performance computing (HPC) is driving the polarization of advanced processes and packaging, with TSMC positioned as a key player in this shift [15][19] - The mature process segment is undergoing a structural recovery after a period of inventory clearance, with companies like UMC and VIS showing improved margins [21][22] - Geopolitical factors are reshaping the global supply chain, leading to a trend of localized production and a more fragmented capacity distribution [22][24] Future Outlook - TSMC plans to expand its CoWoS packaging capacity, which is critical for AI chip production, with orders already extending into 2026 [26][34] - Samsung is betting on its 2nm process to regain competitiveness, but faces risks associated with its current market position [27][28] - For companies like SMIC and Huahong, improving profitability will be crucial for maintaining their positions in the global supply chain [29][31]