US Semiconductors_ November Sales Above Our Forecast and Seasonality. Raise C24 Semi Sales to Up 18% YoY. Expect 2025 Semi Sales of Up 9% YoY.

Summary of US Semiconductors Conference Call Industry Overview - The conference call focuses on the US semiconductor industry, specifically discussing sales performance and forecasts for 2024 and 2025 [1][8][16]. Key Points Sales Performance - November 2024 semiconductor sales reached $59.0 billion, reflecting a 10.5% month-over-month (MoM) increase, surpassing both seasonal expectations of 1.3% MoM and prior estimates of $54.1 billion (up 1.2% MoM) [2][9]. - Year-over-year (YoY) sales for November increased by 23.3%, exceeding the forecasted 13.0% YoY growth [2][9]. Forecast Adjustments - The 2024 semiconductor sales forecast has been revised upward from 17% YoY to 18% YoY, translating to $624.1 billion in total sales [5][22]. - For 2025, semiconductor sales are expected to grow by 9% YoY, amounting to $680.5 billion, driven by seasonal growth across all quarters [5][23]. Unit and Pricing Trends - Units excluding discretes showed a 1.3% MoM decline, which was below the expected 6.1% MoM increase and seasonal trends [3][15]. - On a YoY basis, units ex-discretes were up 4.7%, again below the estimate of 12.6% YoY [3][15]. - Average Selling Prices (ASPs) ex-discretes increased by 12.2% MoM, significantly above the forecasted 4.2% MoM decline and seasonal expectations of 2.9% MoM [4][18]. - YoY ASPs rose by 19.7%, surpassing the estimated 2.2% YoY increase [4][18]. Market Demand - The semiconductor market remains positive, with solid demand from data centers, AI, and communication sectors, which collectively account for 27% of semiconductor demand [6][25]. Valuation Concerns - The SOX index is currently trading at 29X NTM P/E, representing a 36% premium over the S&P 500, which is significantly higher than the historical average premium of 7%. This valuation is noted as a potential risk for semiconductor stocks [25]. Additional Insights - The three-month rolling average sales from September to November 2024 were $57.8 billion, reflecting a 20.7% YoY increase, although slightly down from $56.9 billion (up 22.1% YoY) in the previous period [10]. - DRAM sales exhibited the largest positive delta, increasing by 57.4% MoM, while microprocessor sales were up only 0.3% MoM, indicating varied performance across different semiconductor segments [19][20]. This summary encapsulates the key insights and data from the conference call regarding the US semiconductor industry, highlighting sales performance, forecasts, pricing trends, and market demand dynamics.