Summary of Global Memory Industry Conference Call Industry Overview - The conference call focused on the memory market, specifically DRAM and NAND sectors, highlighting trends in spot and contract prices for September 2025 [2][17]. Key Points on DRAM Market - **Spot Prices**: - Spot prices for PC DDR4 chips surged by 31% MoM, while DDR5 increased by 28% MoM, driven by fears of a broad DRAM shortage [19]. - Server DDR4 spot prices rose by 19% MoM, with DDR5 increasing by 17% MoM due to strong demand forecasts from CSP customers [19]. - **Contract Prices**: - September contract prices for conventional DRAM were stable MoM, but a 24% QoQ increase is expected in 3QCY25, with specific increases of ~20% for PC, 9% for Server, 27% for Mobile, and ~90% for Consumer [4][25]. - The demand forecast from CSPs indicates a potential supply shortage, prompting vendors to seek higher prices [4][7]. - TrendForce anticipates a 5-10% QoQ increase in DRAM contract prices for 4QCY25, stronger than previous expectations [4][7]. - **Market Sentiment**: - The market is shifting in favor of suppliers, with OEMs and module houses increasing inventory in anticipation of shortages [7][20]. - Despite a stable demand outlook for some applications, OEMs are reconsidering their purchasing strategies due to expected shortages [20]. Key Points on NAND Market - **Spot Prices**: - NAND wafer spot prices increased by 9-11% MoM, driven by a surge in eSSD demand due to hard drive shortages [5][24]. - **Contract Prices**: - NAND wafer contract prices rose mildly by 2-3% MoM in September, with a 4-14% increase compared to 2QCY25 [6][24]. - The demand for eSSD is expected to lead to a more significant increase in contract prices in 4QCY25 [6][24]. - **Market Dynamics**: - The NAND market is experiencing a favorable pricing environment, but there are concerns about the sustainability of this demand, particularly as it is largely driven by HDD shortages [22][24]. - The overall sentiment in the NAND market is cautious, with expectations of price increases but skepticism about long-term strength due to competition and weak growth in non-enterprise segments [22][24]. Investment Implications - **Company Ratings**: - Samsung Electronics is rated Outperform with a price target of KRW 95,000 [11]. - SK hynix is rated Outperform with a price target of KRW 400,000 [12]. - Micron is rated Outperform with a price target of US$170.00 [13]. - KIOXIA is rated Underperform with a price target of JPY3,500.00 [14]. Additional Insights - The anticipated increase in DRAM prices is expected to be supported by the growth in HBM shipments and a favorable pricing outlook for conventional DRAM [22]. - The overall market dynamics suggest a potential upside to conventional DRAM pricing assumptions for the upcoming year [22]. This summary encapsulates the key insights from the conference call, focusing on the memory market's current state and future expectations.

Investment Rating - The report maintains a "Buy" rating for Samsung Electronics and SK Hynix, with target prices raised to KRW123,000 and KRW540,000 respectively [34][5]. Core Insights - The memory market is expected to enter an unprecedented super-cycle, driven by significant investments from US Big Tech in AI and traditional servers, leading to a substantial increase in memory demand by 2026 [1][4]. - Demand for traditional server-related memory, such as DDR4 and DDR5, is projected to grow by around 50% in 2026, while enterprise SSD demand is expected to nearly double [2]. - Operating profit margins for commodity DRAM are anticipated to recover to levels approaching 70% by 2026, while NAND margins are expected to reach 30-40% [3]. Summary by Sections Market Overview - The memory market is poised for a super-cycle, with substantial investments continuing into 2027 and 2028, followed by a likely downturn in 2028 [4]. - US Big Tech's capital expenditures are projected to increase significantly, with a 30% year-on-year growth expected in 2026 [13]. Demand Projections - Traditional server investments declined by 30% year-on-year in 2023 but are expected to grow by 20-30% in 2026 [2]. - Demand for enterprise SSDs, which account for approximately 40% of total NAND demand, is projected to grow by over 100% in 2026 due to strong storage needs from both traditional and AI data centers [2]. Profitability Forecasts - Samsung's operating profit is projected to reach KRW90 trillion in 2026 and KRW130 trillion in 2027, with a significant increase in target price reflecting this growth [5]. - SK Hynix is expected to achieve operating profit of KRW72 trillion in 2026 and KRW88 trillion in 2027, with a 50% increase in target price [5]. Competitive Landscape - Samsung is expected to have the highest relative capacity flexibility among memory manufacturers, with significant production scaling capabilities at its Pyeongtaek fabs [4]. - The entry of Samsung into Nvidia's HBM market is considered highly probable, which could enhance its competitive position [30].

Asia Pacific Equity Research 02 October 2025 J P M O R G A N 更多资料加入知识星球：水木调研纪要 关注公众号：水木纪要 Correction (See disclosures for details) Memory Market Update Stargate, the Demand Carrier, has arrived: Implications for the Memory Industry Following the OpenAI-Samsung/SK Hynix DRAM partnership announcement yesterday, we provide reasoning, economics, and share price implications in today's report. We expect OpenAI to be a significant DRAM demand carrier and maintain our multi-year bullish view on the memory industry ...

Summary of Key Points from the Conference Call Industry Overview - **Industry**: Memory Semiconductor Industry, specifically focusing on DRAM and NAND markets - **Key Players**: Samsung Electronics (SEC), SK Hynix, U.S. and Chinese Cloud Service Providers (CSPs) Core Insights and Arguments DRAM Pricing Trends - **Conventional DRAM**: - Pricing increased by 10-15% quarter-over-quarter (qoq) in 3Q25 - Expected to rise by 8-13% qoq in 4Q25, driven by strong server demand and supply constraints [1][9] - **PC DRAM**: - Pricing rose by 8-13% qoq in 3Q25 - Anticipated increase of 3-8% qoq in 4Q25 due to higher server DRAM allocation constraining supply [3][9] - **Server DRAM**: - Pricing rose by 3-8% qoq in 3Q25 - Expected to increase by 5-10% qoq in 4Q25, with significant demand growth from U.S. (>25% yoy) and Chinese CSPs (>20% yoy) [4][9] NAND Pricing Trends - **NAND ASP**: - Increased by 3-8% qoq in 3Q25 - Projected stronger growth of 5-10% qoq in 4Q25, primarily due to robust demand for eSSD [2][10] Low-Power DRAM - Demand for low-power DRAM is rising due to increased DRAM content in smartphones and other applications - Pricing for LPDDR4/LPDDR5 rose by 10-15% and 38-43% qoq in 3Q25, with expectations of further increases in 4Q25 [5][8] Additional Important Insights - **Market Dynamics**: - Supply tightness in the memory market is expected to continue, influencing pricing strategies and inventory management among OEMs [3][4] - **Long-term Agreements**: - Discussions on long-term agreements for server DRAM pricing have begun, indicating a proactive approach to manage future demand and supply [4] - **Pricing Premiums**: - DDR5 16Gb spot pricing is trading at a 24% premium compared to contract prices, while DDR4 8Gb is at a 5% premium [11][13] Risks and Considerations - **Key Risks**: - Major deterioration in memory supply/demand dynamics - Sharp contraction in smartphone margins - Potential loss of market share in mobile OLED [20][23] Valuation and Ratings - **Samsung Electronics**: - Target price for common shares set at W96,000 and W78,000 for preference shares, rated as "Buy" [19] - **SK Hynix**: - Target price set at W300,000, rated as "Neutral" [22] This summary encapsulates the essential insights and trends discussed in the conference call, providing a comprehensive overview of the current state and future expectations of the memory semiconductor industry.

Summary of Key Points from Morgan Stanley Asia's Thematic Opportunities (3Q25) Industry Overview - **Industry**: Various sectors within the Asia Pacific region, focusing on emerging investment themes and opportunities identified by Morgan Stanley's research department. Core Themes and Investment Opportunities 1. **Future of Energy** - Global solar market expected to see gross margins for integrated module players turn positive by 2026-27 due to anti-involution reforms [3][3] - Japan's natural gas demand projected to grow at a CAGR of +0.8% from 2023-2031, with LNG imports from the US expected to rise by +14% [3][3] - Global new nuclear capacity anticipated to reach 587GW by 2050, with significant growth in Asia, particularly China and India [3][3] 2. **Tech Diffusion** - AI data centers projected to consume up to 1,068 billion liters of water annually by 2028, an 11x increase from 2024, driven by cooling and electricity generation needs [3][3] - AI NAND market expected to account for 34% of the global NAND market by 2029, adding an incremental US$29 billion to the total addressable market [3][3] 3. **Multipolar World** - Defense spending in Asia (South Korea, Japan, Singapore, India) projected to expand at a 12% CAGR to US$354 billion by 2029, matching China's defense budget [3][3] - Vehicles with Level 2+ all-scenario smart driving expected to reach 28% of unit sales by 2030, up from 8% in 2024, with a global ADAS/AD market size estimated at US$200 billion by 2030 [3][3] 4. **Capital Market Reform** - MSCI China's ROE expected to rise to 13.3% by 2030, supported by policy execution and structural reforms [3][3] - Singapore's equity market reforms could drive ROE to 14% from 12%, potentially doubling market cap by 2030 [3][3] 5. **Longevity** - Innovative drug sales projected to comprise 53% of China's pharmaceutical market by 2030, up from 29% in 2023, with a CAGR of 21% from 2024 to 2030 [3][3] Additional Insights - **Water Consumption Risks**: AI's water consumption poses high local risks, especially in data center hubs facing water scarcity, highlighting the need for strategic investments in water-efficient technologies [27][27] - **Supply Chain Dynamics**: The report discusses the ongoing reorientation of supply chains due to geopolitical tensions, particularly between the US and China, and the shift towards onshoring production in the US for high-end products [56][56] - **Defense Industry Outlook**: The report emphasizes the expected super-cycle in Korea's defense industry, driven by rising global defense budgets and the need for modernization [64][64] Key Stock Implications - **Top Picks**: The report identifies several companies across various themes, including: - **Tech Diffusion**: KIOXIA, Samsung Electronics, and Hanwha Aerospace [12][12] - **Future of Energy**: Reliance Industries and Gulf Development PCL [12][12] - **Longevity**: Jiangsu Hengrui and Hansoh Pharmaceutical Group [12][12] This summary encapsulates the key themes and insights from Morgan Stanley's thematic opportunities report, highlighting potential investment avenues and risks within the Asia Pacific region.

J P M O R G A N Asia Pacific Equity Research 07 October 2025 Asia Technology Asian investor marketing feedback on memory/Korea tech, EV battery/materials, and holdco (82-2) 758-5725 jay.h.kwon@jpmorgan.com J.P. Morgan Securities (Far East) Limited, Seoul Branch Sangsik Lee (82-2) 758 5146 sangsik.lee@jpmorgan.com J.P. Morgan Securities (Far East) Limited, Seoul Branch Neelay Y Kamath (91-22) 6157 3764 neelay.kamath@jpmchase.com J.P. Morgan India Private Limited See page 9 for analyst certification and impor ...

Core Insights - AMD has signed a multi-year chip supply agreement with OpenAI, potentially generating tens of billions in revenue for AMD and enhancing its position in the AI sector [1] - The deal involves AMD supplying 6 gigawatts of compute capacity, sufficient to power approximately 4.5 million homes, starting with the Instinct MI450 GPU [1] - OpenAI will receive the first gigawatt of capacity in the second half of 2026 [1] AMD's Product Performance - AMD claims that the MI450 series will outperform Nvidia's comparable offerings through hardware and software enhancements, many of which will be developed with OpenAI's collaboration [2] - Current MI355X and MI300X series GPUs are already effective for AI inference in large language models due to their substantial memory capacity and bandwidth [2] Stock Agreement Details - As part of the agreement, OpenAI has the option to purchase up to 160 million shares of AMD stock, representing a 10% stake [3] - The first tranche of shares will vest with the initial 1 gigawatt deployment, with additional tranches vesting as OpenAI acquires the total 6 gigawatts [3] Stock Price Milestones - OpenAI's stake is linked to AMD's stock price milestones, with the final tranche vesting when AMD's stock reaches $600 per share [4] - AMD shares experienced a significant increase, closing at $164.67 before opening at $222.24, a nearly 35% rise following the announcement of the deal [4] OpenAI's Strategic Moves - OpenAI is actively pursuing multiple chip partnerships to build its AI infrastructure, including plans for five new Stargate data centers with a total capacity of 7 gigawatts [4] - OpenAI CEO Sam Altman described the partnership with AMD as a significant advancement in building the necessary compute capacity for AI [7] Recent Partnerships - In the previous month, OpenAI secured a $100 billion investment from Nvidia for at least 10 gigawatts of compute capacity and signed a $10 billion deal with Broadcom for custom AI chips [8] - OpenAI is also collaborating with Samsung Electronics and SK Hynix to source DRAM memory chips for its Stargate project and to establish data centers in South Korea [8]

Group 1 - OpenAI CEO Sam Altman is initiating a global fundraising effort in East Asia and the Middle East to secure financing and manufacturing partners for the company's computing capacity needs [1][3] - Discussions have been held with major suppliers like Taiwan Semiconductor Manufacturing, Foxconn, Samsung, and SK Hynix to enhance AI chip production and prioritize OpenAI's orders [2][3] - OpenAI plans to spend approximately $16 billion on renting computing servers this year, with projections indicating this expenditure could escalate to around $400 billion by 2029 [4] Group 2 - Samsung Electronics and SK Hynix have signed letters of intent to supply memory chips for OpenAI's data centers [3] - Altman is also scheduled to meet with investors in the United Arab Emirates to raise funds for OpenAI's infrastructure expansion and research initiatives [3]

The sector is being swept up by a wave of good news from AI companies, including ChatGPT-owner The bullishness has pushed the combined market capitalisation of the Philadelphia Stock Exchange Semiconductor Index and a gauge tracking Asia chip stocks up by just over $200 billion in the latest session, according to Bloomberg.Korean chip stocks were among the biggest gainers on Thursday, surging on the OpenAI deal and sending the Kospi Index to a record high. Shares of SK Hynix jumped 10%, while Samsung Elect ...

OpenAI's recent funding deal and stunning valuation helped lift U.S. stocks to another record closing high. OpenAI's latest investment round valued the privately held AI company at about $500 billion, and two tech heavyweights, Samsung Electronics and SK Hynix, signed on as memory-chip partners for its "Stargate†infrastructure project. Semiconductor stocks rose, and investors looked past the potential fallout from a government shutdown that is expected to stretch into next week. ...