Research | Equity Jin Guo +86(21)2401-8943 | jin.guo@goldmansachs.cn Goldman Sachs (China) Securities Company Limited Allen Chang +852-2978-2930 | allen.k.chang@gs.com Goldman Sachs (Asia) L.L.C. | Exhibit 1: 2Q25E snapshot | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | GSe vs. | | Rmb mn | 2Q25E | YoY | QoQ | Cons. | Cons. | | Revenue | 2,371 | 20% | 24% | 2,245 | 6% | | GM (%) | 39.2% | 1ppts | 1.7ppts | 38.4% | 0.8ppts | 24 July 2025 | 7:38AM CST Gigadevice (603986.SS): 2Q Preview; earning ...

Summary of Conference Call on Greater China Semiconductors Industry Overview - The NAND module market is showing signs of recovery, with a positive outlook on companies like Phison and Longsys, while maintaining an overweight (OW) rating on SIMO. Concerns regarding structural specialty DRAM persist, with week-over-week (WoW) project wins being crucial for differentiation [1][4][9]. Key Points on NAND Modules - **Price Increases**: After the Lunar New Year, two NAND suppliers raised wafer prices by 9-11%, and SanDisk announced price hikes for channels and consumer customers starting April 1. Phison noted that NAND prices in China are the highest in the region due to strong demand [2][9]. - **Demand Recovery**: The bottom for NAND modules is believed to have passed, with expectations of price stabilization in Q2 2025 due to improved supply controls. Phison reported shipment increases in February and anticipates strong demand throughout 2025, with concerns about insufficient NAND supply in the second half of the year [3][9]. - **Inventory Management**: Phison plans to accumulate inventories in the first half of 2025, indicating a cyclical recovery based on historical patterns. A price rebound for NAND modules is expected in Q1 2025 if demand from PC OEMs and smartphones continues [3][9]. Specialty DRAM Insights - **Market Sentiment**: Long-term concerns regarding CXMT's specialty DRAM remain unchanged, but recent project wins have helped identify key players. NTC's share price has increased by 37% year-to-date, driven by DDR4 sentiment and PC demand ahead of tariffs [4][9]. - **Price Trends**: Specialty DRAM spot discounts are currently at 33%, down from 35% a month ago, primarily due to weak consumer electronics demand and oversupply. TrendForce predicts a 10-15% quarter-over-quarter price decline for DDR4 in Q1 2025, followed by another 5-10% decline in Q2 2025 [14][9]. Stock Recommendations - **Upgrades and Downgrades**: - Phison and Longsys are upgraded to OW due to disciplined supply and strong SSD demand. - Winbond is also upgraded to OW based on bottoming fundamentals, while NTC is rated underweight (UW) due to competition from CXMT and lack of project wins [9][48]. - **Preferred Stocks**: SIMO, Phison, and Longsys are highlighted as preferred investments in the Greater China memory sector, with expectations of a recovery in NAND module prices and demand driven by edge AI [13][9]. Additional Insights - **China's Memory Investment**: China's aggressive memory investment is expected to continue into 2025, positively impacting wafer fabrication equipment (WFE) players. CXMT and YMTC are planning significant capacity expansions [52][53]. - **Market Dynamics**: The competitive landscape is shifting, with global suppliers like Samsung and SK Hynix beginning to cut production, which may lead to a new upcycle for specialty DRAM [35][9]. This summary encapsulates the key insights and recommendations from the conference call regarding the Greater China semiconductor industry, particularly focusing on NAND modules and specialty DRAM.