2025-09-17 01:51Summary of Key Points from the Conference Call Industry Overview - The conference call primarily discusses the AI semiconductor supply chain, focusing on companies like Oracle, Nvidia, Broadcom, and TSMC [1][2][3][4]. Core Insights and Arguments 1. Oracle's Revenue Backlog: Oracle announced a significant revenue backlog, which positively impacted Nvidia and its supply chain stocks, including TSMC and KYEC. The company expects its fiscal year 2026 capital expenditures (CapEx) to be around $35 billion, primarily for revenue-generating equipment [2][11]. 2. AI ASIC Demand: Broadcom reported $10 billion in revenue from a fourth customer, identified as OpenAI, indicating strong demand for AI ASICs. This revenue is based on server racks, with less than 100% revenue capture noted [2][9]. 3. TSMC's Moore's Law 2.0: TSMC's Deputy Co-COO discussed the transition to Moore's Law 2.0, emphasizing the importance of system integration over mere chip scaling. This shift is expected to enhance the production timelines for Nvidia's Rubin GPU chip, projected to enter mass production in 2Q26 [3][20]. 4. Cloud CapEx Growth: The global cloud CapEx is expected to reach $582 billion in 2026, reflecting a 31% year-over-year growth, which is significantly higher than the consensus estimate of 16% [12][13]. 5. AI Server CapEx: The implied AI server CapEx is projected to grow by approximately 70% year-over-year in 2026, driven by increased spending on short-lived assets [13]. Additional Important Insights 1. Stargate Project: A joint venture between OpenAI, Softbank, and Oracle aims to develop infrastructure for next-gen AI, with indications of strong engagement in the supply chain, particularly in server racks [9]. 2. Chip Consumption: The consumption of Blackwell chips is expected to reduce inventory risks in the AI semiconductor supply chain, with 28,000 GB200 NVL72 racks translating to around 2 million units of chip consumption [10]. 3. Market Dynamics for KYEC: KYEC's target price was raised from NT$158 to NT$188 due to expected strong revenue growth from AI CapEx hikes and market share gains in ASIC and chip probing [71][72]. 4. CPO Technology: The adoption of Co-Packaged Optics (CPO) technology is anticipated to start production in 2H26, with discussions on its coexistence with copper cables [24]. Conclusion The conference call highlighted a robust outlook for the AI semiconductor industry, driven by significant investments from major players like Oracle and Nvidia. The transition to Moore's Law 2.0 and the expected growth in cloud CapEx and AI server CapEx indicate a strong demand trajectory for AI-related technologies and infrastructure.