Investment Rating - The report maintains an Overweight (OW) rating on TSMC, which is also highlighted as a Top Pick [5]. Core Insights - New tax credits for semiconductor firms building capacity in the US are set to increase from 25% to 35%, benefiting companies like TSMC [1]. - TSMC's commitment to invest in its US fab is expected to enhance its chances of receiving exemptions from semiconductor tariffs, thereby reducing profit burdens associated with US capacity expansion [1]. - The forecast for TSMC's 3Q25 revenue growth is approximately 3% quarter-over-quarter in USD terms, which is lower than the typical seasonal growth of 6-7% [2]. - Despite the short-term revenue growth forecast, TSMC is expected to raise its full-year USD revenue guidance from mid-20% to high-20% due to strong demand in AI [2]. - TSMC's 2026 CoWoS capacity expansion is anticipated to be a significant catalyst for the global AI supply chain [2]. Summary by Sections Revenue Guidance - TSMC's 3Q25 revenue guidance is projected at NT$910 billion, with a quarter-over-quarter decline of 1.6% and a year-over-year increase of 35.1% [3]. - Gross margin (GM) is expected to drop by 1.5 percentage points to 55.8% due to the TWD's appreciation against the USD [2][3]. Financial Metrics - TSMC's price target is set at NT$1,288.00, indicating an 18% upside from the current price of NT$1,090.00 [5]. - The market capitalization of TSMC is currently NT$28,261,469 million, with an average daily trading value of NT$42,730 million [5]. - Projected EPS for TSMC is NT$45.25 for FY24, NT$55.01 for FY25, and NT$64.61 for FY26 [5].

Investment Rating - The report maintains an "Overweight" (OW) rating for TSMC and expresses bullish sentiment towards AI-related investments, particularly in the semiconductor sector [2][4]. Core Insights - TSMC's CoWoS capacity is projected to grow over 30% year-on-year, reaching approximately 90-95k by 2026, which is favorable for both Nvidia and AI ASIC supply chains [1][2]. - There is strong demand for AI applications in China, but hardware supply constraints are identified as a significant bottleneck [3]. - The report highlights a robust growth forecast for cloud semiconductors in 2026, with TSMC's CoWoS-L capacity expected to expand to 68k, indicating strong demand for Blackwell and Rubin chips [2][8]. Summary by Sections AI Supply Chain Insights - The report indicates that Nvidia's B30 GPU shipments to China are uncertain and could impact China's AI capital expenditures [1][3]. - Chinese AI developers are considering alternatives like Huawei chips if Nvidia's B30 cannot be shipped, but they have not yet seen Huawei's 910C available for sale [3]. TSMC Capacity and Demand - TSMC's total CoWoS capacity is expected to be around 90-95k in 2026, reflecting a 33% increase from 70k at the end of 2025 [2][8]. - The report raises TSMC's CoWoS capacity forecast for 2026 from 90k to 93k wafers per month, with non-TSMC capacity remaining unchanged [8][9]. Customer Demand and Forecasts - Nvidia's CoWoS consumption is projected to remain at 580k units in 2026, with an increase in CoWoS-L consumption estimates due to strong demand [13]. - Broadcom's CoWoS consumption estimate is raised to 110k units in 2026, driven by higher demand for Meta's MTIAv3 chips [13]. AI Capex and Market Sentiment - The report anticipates that the top four US hyperscalers will generate $550 billion in operating cash flow in 2025, supporting ongoing investments in AI-related data centers [31][32]. - Average AI capex/EBITDA is expected to be around 50% in 2025, indicating strong financial capacity for further spending [32].

Core Insights - Taiwan Semiconductor Manufacturing Company (TSMC) shares reached a 52-week high of $233.82, closing at $233.60, with an 18.2% year-to-date (YTD) increase, outperforming the Zacks Computer and Technology sector's 5.6% rise [1][10] - TSMC has outperformed peers such as NVIDIA, Advanced Micro Devices, and Intel, which saw YTD increases of 17%, 14.6%, and 9.1%, respectively [2][10] - Investor confidence in TSMC's long-term prospects is growing, supported by strong fundamentals and a favorable long-term outlook [3] Financial Performance - In the first quarter of 2025, TSMC reported a 35% year-over-year revenue increase to $25.53 billion and a 53% rise in net income to nearly $11 billion [8] - The company's earnings per share (EPS) jumped 53.6% to $2.12, exceeding the Zacks Consensus Estimate of $2.03, with an average surprise of 6.9% over the last four quarters [9] AI-Driven Growth - AI-related revenues for TSMC tripled in 2024, contributing a mid-teen percentage to total revenues, with expectations to double again in 2025 and a projected 40% compound annual growth rate over the next five years [7][10] - TSMC is positioned as a key player in the AI revolution, supplying advanced chips to major companies like NVIDIA and AMD [6] Investment and Valuation - TSMC plans to invest between $38 billion and $42 billion in capital expenditures in 2025, significantly higher than the $29.8 billion investment in 2024, with 70% of this focused on advanced manufacturing processes [11] - The Zacks Consensus Estimate predicts revenue growth of 29.8% and 17.3% for 2025 and 2026, respectively, with EPS expected to rise by 31.8% and 15.8% [12] - TSMC's forward 12-month price-to-earnings (P/E) ratio is 23.32X, lower than the sector average of 26.7, making it an attractive option for long-term investors [13][14] Conclusion - TSMC's dominance in advanced nodes, increasing AI-related demand, and aggressive capacity investments position it well for future growth, making it a compelling buy opportunity [15]

Investment Rating - The report does not explicitly provide an investment rating for the industry or specific companies covered [4][5]. Core Insights - The report highlights upcoming volatility events that could significantly impact equity markets, particularly for large-cap, highly liquid stocks in the Asia Pacific region [1][2]. - A tracker of key upcoming events for major companies in the region is compiled, focusing on those with substantial market capitalization and trading volume, as well as smaller stocks known for price volatility in sectors like Healthcare and Materials [2][4]. Summary by Relevant Sections Upcoming Events - Key macro catalysts for Japan are included, indicating a focus on significant market-moving events [2]. - Specific companies and their anticipated catalysts are listed, such as: - ANTA Sports Products (2020.HK) with an operational update expected in early to mid-July 2025, monitoring for faster-than-industry performance [11]. - Fast Retailing (9983.T) with FY8/25 Q4 results due in October 2025, assessing if the bottom of performance in China is confirmed [11]. - Pop Mart International (9992.HK) expected to issue a positive profit alert in early to mid-July 2025 [11]. Sector-Specific Insights - In the Materials sector, companies like Aluminum Corp. of China (2600.HK) are monitored for aluminum demand, particularly from solar applications, with developments expected in the second half of 2025 [23]. - The report also tracks developments in the Semiconductor sector, with companies like Samsung Electronics (005930.KS) and TSMC (2330.TW) expected to provide updates on market outlook and revenue guidance in the second half of 2025 [25][26].

Investment Rating - The industry investment rating is In-Line [7] Core Insights - Robust spending in China is expected to lift WFE (Wafer Fabrication Equipment) estimates, with government subsidies being a primary driver rather than immediate market demand [3][10] - AI-driven demand is strong but faces bottlenecks in back-end test capacity, while the current annual capex of TSMC is around $40 billion, which may sustain AI growth without significant increases in demand from smartphones and PCs [4] - The EDA (Electronic Design Automation) market remains resilient despite proposed export restrictions to China, with potential for EDA companies to resume some licensing deals [5][10] Summary by Sections WFE Equipment - China is aggressively expanding its semiconductor capacity, suggesting upside to FY25 revenue views for ASML and ASM, with China representing a mid-20s percentage of revenue [3] - WFE growth may moderate in the medium term due to bottlenecks in back-end test capacity, while litho intensity is expected to hit an asymptote in the next decade [4][10] EDA & IP - The EDA market is resilient despite export restrictions, with a wide range of potential outcomes regarding China and AI [5][10] - Local Chinese EDA solutions are perceived as limited in competitive threat due to incomplete tool-chains for advanced nodes [11] Power Segment - Power semiconductors are a clear growth area, but adoption of new technologies may remain niche due to cost and infrastructure readiness [12] - Infineon is recognized for its leadership and cautious market strategies, while Chinese firms are aggressively developing high-voltage solutions [12] Notable Highlights - Intel's transformation remains uncertain with significant execution risks under new leadership, while the PC and smartphone markets are subdued [13] - Memory markets are expected to strengthen in the second half of 2025, driven by AI and edge applications [13]

Investment Rating - The investment rating for the semiconductor capital equipment industry is "In-Line" [4]. Core Insights - The 2025 China WFE (Wafer Fabrication Equipment) forecast has been revised from a decline of 12% year-over-year to a decline of 3%, with the 2025/2026 WFE forecast adjusted from $104 billion/$109 billion to $109 billion/$110 billion [1][10]. - China is expected to show stronger performance in the second half of 2025 compared to the first half, despite previous concerns about the sustainability of WFE demand due to low utilization rates outside major players [2][11]. - Equipment imports into China decreased by 4% year-over-year from January to May 2025, but are anticipated to pick up starting in July, mirroring the growth seen in the second half of 2024 [2][11]. Summary by Sections WFE Forecast - The WFE revenue forecast for 2025 has been increased to $109 billion (up 6% year-over-year) from $104 billion, while the 2026 forecast is slightly raised to $110 billion (up 1%) from $109 billion [1][4]. - The WFE revenue for 2025 is projected to be $109,058 million, with a year-over-year change of 6% [7]. Company-Specific Revisions - Revenue contributions from TSMC for KLA and AMAT have been revised upwards for 2025 and 2026, with KLA's contribution increasing from $2.65 billion/$2.96 billion to $2.76 billion/$3.05 billion, and AMAT's from $5.60 billion/$5.26 billion to $5.93 billion/$5.38 billion [3][22]. - The revenue forecast for KLA in 2025 has been adjusted from $12.1 billion to $12.3 billion, and for AMAT from $28.3 billion to $28.7 billion [22][27]. Market Dynamics - The semiconductor capital equipment market is expected to see a significant uptick in demand driven by logic customers in China, with the region remaining the largest for WFE demand despite challenges [10][15]. - The overall sentiment indicates that state-subsidy-induced spending in China will continue to support equipment purchases, even with low utilization rates among smaller players [21][19]. Regional Insights - The WFE by region shows that China will continue to dominate the market, with significant contributions expected from Taiwan and Korea as well [9][17]. - The forecast indicates that while Taiwan and Korea will drive growth, China remains the largest region for WFE demand [15][17].

Core Insights - Seeking Alpha has introduced a new contributing analyst, Jia Ming Eow, who is encouraged to share investment ideas through article submissions [1] Company and Industry Summary - The article does not provide specific information regarding any company or industry performance, financial metrics, or market analysis [2][3]

Investment Rating - The report initiates coverage of K&S (KLIC US) with a Buy rating, and BE Semiconductor (BESI NA) with a Neutral rating, while maintaining a Buy rating on ASMPT (522 HK) [3][6][11]. Core Insights - Advanced packaging (AP) is expected to evolve significantly from 2025 onwards, with a shift from CoWoS-S to CoWoS-L/R, increased adoption of SoIC driven by HBM5, and potential upgrades in InFO technology led by Apple [3][6]. - The semiconductor cycle's recovery is a key catalyst for K&S and ASMPT, given their substantial sales exposure to conventional packaging [3][6]. CoWoS Technology - CoWoS technology is transitioning from CoWoS-S to CoWoS-L, with TSMC expected to increase its CoWoS-L capacity from approximately 20% in 2024 to nearly 60% in 2025 [7][21]. - CoWoS-S is anticipated to face oversupply due to non-TSMC supply chain expansions, while CoWoS-L is expected to be in demand for high-end GPUs [7][28]. SoIC Technology - SoIC is projected to gain importance with the adoption of high-NA EUV technology, although headwinds are expected in 2025 due to limited new adopters and potential capex constraints from Intel [8][14]. - AMD is currently the major adopter of SoIC, with potential future demand driven by Apple and HBM technologies [8][14]. InFO Technology - Apple is likely to adopt upgraded InFO technology from 2026 onwards, necessitating capacity upgrades to accommodate new application processor designs [9][20]. - The transition from InFO-PoP to InFO-M is expected as the I/O count between DRAM and application processors becomes insufficient [9][20]. Company-Specific Insights - K&S is positioned to be the primary TCB supplier for TSMC's on-wafer process starting in 2025, benefiting from the shift towards CoWoS-L technology [3][6]. - ASMPT is expected to gain market share in the HBM market from a low base, with its TCB potentially adopted by TSMC and Apple in the future [3][6]. - BE Semiconductor faces challenges due to rich valuations and potentially disappointing hybrid bonding orders in 2025 [3][6].

Investment Rating - The report assigns an "Overweight" rating to TSMC with a price target of NT$1,275.0 by December 2025 [2][28]. Core Insights - TSMC is expected to maintain strong structural growth drivers due to its near-monopoly position in AI accelerators and edge AI, supported by a robust process roadmap and industry-leading packaging technology [28]. - The report anticipates a significant ramp-up in TSMC's wafer-level multichip module (WMCM) capacity, particularly for high-end iPhone models, which could lead to substantial revenue growth [5][11]. - CoWoS (Chips-on-Wafer-on-Substrate) capacity is projected to remain tight through the second half of 2025 but is expected to reach a more balanced situation by the second half of 2026 [3][4]. Summary by Sections CoWoS Capacity and Demand - TSMC's CoWoS capacity is expected to grow significantly, reaching 102,000 wafers per month (wfpm) by the end of 2027, with a growth rate of 138% in 2025 [3]. - NVIDIA's CoWoS demand is projected to grow by 25% in 2026, reaching 538,000 units, driven by the migration to the Rubin platform [4][9]. - Overall CoWoS consumption is forecasted to increase from 679,000 wafers in 2025 to 1,132,000 wafers in 2027, reflecting a year-on-year growth of 32% [9]. WMCM Capacity and Adoption - WMCM capacity is expected to reach 27,000 wfpm by the end of 2026 and ramp up to 40,000 wfpm by the end of 2027, driven by Apple’s adoption in high-end iPhone models [5][11]. - If all iPhones were to migrate to WMCM long-term, this would require approximately 90,000 wfpm of WMCM capacity, indicating a significant expansion plan [5]. Customer Demand and Projections - Broadcom is expected to see steady growth in CoWoS consumption, particularly for Google TPUs, while new customers like Meta are anticipated to ramp up in 2026 [4]. - AMD's CoWoS forecasts remain muted for 2025 and 2026, with potential growth expected in the MI450 series in late 2026 and beyond [4]. - The report highlights that the CoWoS ecosystem is maturing, with more non-AI processors beginning to adopt CoWoS packaging, indicating broader market adoption [4]. Future Outlook - TSMC's structural growth is expected to be supported by price hikes on leading-edge nodes and a strong ramp-up of N2 technology in 2026 [28]. - The report suggests that TSMC will likely raise its FY25 USD revenue guidance, alleviating concerns regarding gross margin impacts from overseas expansion and currency fluctuations [28].

Global memorv EQUITY: MEMORY Upside potential remains solid into 2027F, thanks to Al Commodity DRAM/NAND: strong 1H25F and weak 4Q25F – shipment and ASP growth in 2Q25F likely higher than expected due to pull-in demand in anticipation of a tariff hike For 2Q25, we had pencilled in 10-20% q-q growth in both DRAM and NAND shipments. However, we now believe that actual shipment growth could turn out to be higher than our previous expectation ([company guidance] DRAM: SEC and Hynix 10-12% q-q; NAND: SEC 15% q-q ...