Managing Director, Zero One, Zero One

Vincent Fernando, CFA

Managing Director, Zero One

Zero One

Founded in 2015, Zero One produces independent investment research and provides corporate finance advisory services with a focus on both listed and private technology companies. Founder Vincent Fernando has over 20 years of experience in US and Asia capital markets.

Independent Investment Research

Equity Bottom-Up

Silicon Motion Technology / Equity Bottom-Up

<ul>
<li>Silicon Motion reported results last week that beat consensus; Moreover, the company expects strong growth not just in 2024E, but also in 2025E.</li>
<li>The company's growth will significantly exceed PC and mobile phone market growth thanks to strong memory demand trends within these segments.</li>
<li>The company sees NAND Flash in shortage into 2025E based on visibility into its client ecosystem. We continue to view SIMO as a next-wave play on the Memory recovery.</li>
</ul>


Silicon Motion reported results last week that beat consensus; Moreover, the company expects strong growth not just in 2024E, but also in 2025E.
The company's growth will significantly exceed PC and mobile phone market growth thanks to strong memory demand trends within these segments.
The company sees NAND Flash in shortage into 2025E based on visibility into its client ecosystem. We continue to view SIMO as a next-wave play on the Memory recovery.


Silicon Motion Memory Readthrough: NAND Flash to Remain In Shortage; Up-Cycle to Persist

Taiwan Tech Focused Senior Analyst

Patrick Liao

United Microelectronics Corp / Equity Bottom-Up

<ul>
<li>The <a href="https://www.smartkarma.com/entities/united-microelectronics-corp" target="_blank" data-smartkarma-citation="entities:6450:1" rel="noopener">United Microelectronics Corp (2303 TT)'s</a> updated revenue outlook for 1Q24F suggests that it could be relatively flat QoQ..</li>
<li>UMC's Asian clients, particularly <a href="https://www.smartkarma.com/entities/mediatek-inc" target="_blank" data-smartkarma-citation="entities:772:1" rel="noopener">Mediatek Inc (2454 TT)</a> and <a href="https://www.smartkarma.com/entities/novatek-microelectronics-corp" target="_blank" data-smartkarma-citation="entities:10904:1" rel="noopener">Novatek Microelectronics Corp (3034 TT)</a>, are experiencing increased demand in 1Q24F.</li>
<li>On the other hand, European and American clients are more bearish in 1Q24F and have not shown signs of improvement yet.</li>
</ul>


The United Microelectronics Corp (2303 TT)'s updated revenue outlook for 1Q24F suggests that it could be relatively flat QoQ..
UMC's Asian clients, particularly Mediatek Inc (2454 TT) and Novatek Microelectronics Corp (3034 TT), are experiencing increased demand in 1Q24F.
On the other hand, European and American clients are more bearish in 1Q24F and have not shown signs of improvement yet.


UMC (2303.TT; UMC.US): 1Q24F Outlook Could Be Flat QoQ; Asian Clients Show Optimism.

<ul>
<li>Recent results from Micron and SK Hynix did not only signal a recovery for DRAM but also for NAND flash memory. Micron expects improving NAND pricing through CY2025E.</li>
<li>Latest data shows a surge in NAND pricing -- 512GB NAND pricing is now up 116% from its 2023 lows.</li>
<li>Silicon Motion shares are down 5% over the last year. They have been weighed down by their terminated acquisition by MaxLinear, but now could offer a laggard play.</li>
</ul>


Recent results from Micron and SK Hynix did not only signal a recovery for DRAM but also for NAND flash memory. Micron expects improving NAND pricing through CY2025E.
Latest data shows a surge in NAND pricing -- 512GB NAND pricing is now up 116% from its 2023 lows.
Silicon Motion shares are down 5% over the last year. They have been weighed down by their terminated acquisition by MaxLinear, but now could offer a laggard play.


Silicon Motion: Next Wave of the Memory Recovery; High-End NAND Prices More Than Doubled From Lows

Asia and Global Semiconductor and Tech Research

Andrew Lu

Thematic (Sector/Industry)

<ul>
<li>More clear y/y improvement for 8/12" raw wafer, WiFi IC, GaAs RF/VCSEL, and memory vendors but more y/y deterioration for OLED/LCD driver, LCD panel, design service, equipment/materials, and foundry vendors.</li>
<li>GaAs RF and gaming GPU card vendors showed very impressive y/y sales growth of 54% and 63%, respectively. ABF substrate vendors showed the weakest sales decline of 34% among all. </li>
<li>Except A Data (+2.5% m/m) and Phison Electronics (+5.6% m/m) might see stronger share price to reflect stronger November sales, most of others see good/bad news in the price already.</li>
</ul>


More clear y/y improvement for 8/12" raw wafer, WiFi IC, GaAs RF/VCSEL, and memory vendors but more y/y deterioration for OLED/LCD driver, LCD panel, design service, equipment/materials, and foundry vendors.
GaAs RF and gaming GPU card vendors showed very impressive y/y sales growth of 54% and 63%, respectively. ABF substrate vendors showed the weakest sales decline of 34% among all. 
Except A Data (+2.5% m/m) and Phison Electronics (+5.6% m/m) might see stronger share price to reflect stronger November sales, most of others see good/bad news in the price already.


Stories Behind the Reported Nov 2023 Taiwan Semi/Tech Sales

Semiconductors, Memory and SSDs Specialist, Objective Analysis

Jim Handy

Semiconductors, Memory and SSDs Specialist

Objective Analysis

Objective Analysis offers third-party independent market research and data for the semiconductor industry and investors in the semiconductor industry.

Semiconductors, Memory and SSDs

<ul>
<li>MaxLinear's acquisition of Silicon Motion has been abandoned, with both sides threatening arbitration. </li>
<li>It is difficult to understand why the acquisition would have resulted in the synergies projected by management.  The businesses are very different.</li>
<li>Assuming the companies go different ways, expect for SiMo to perform as it has in the past.</li>
</ul>


MaxLinear's acquisition of Silicon Motion has been abandoned, with both sides threatening arbitration. 
It is difficult to understand why the acquisition would have resulted in the synergies projected by management.  The businesses are very different.
Assuming the companies go different ways, expect for SiMo to perform as it has in the past.


Taiwan

Phison Electronics Corp. manufactures and markets USB (Universal Serial Bus) flash pen drives, card readers, adapters, flash memory controllers, and integrated circuits (ICs).

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Phison Electronics (8299 TT)

Silicon Motion Memory Readthrough: NAND Flash to Remain In Shortage; Up-Cycle to Persist

Silicon Motion beats expectations and predicts strong growth for NAND flash in 2024E and 2025E plus new enterprise data center products....

Vincent Fernando, CFA

UMC (2303.TT; UMC.US): 1Q24F Outlook Could Be Flat QoQ; Asian Clients Show Optimism.

UMC's updated revenue outlook for 1Q24F suggests flat growth compared to 4Q23, with increased demand from Asian clients but bearish sentiment from...

Patrick Liao

Silicon Motion: Next Wave of the Memory Recovery; High-End NAND Prices More Than Doubled From Lows

Silicon Motion shares are down 5% over the last year. They have been weighed down by their terminated acquisition by MaxLinear, but now could offer...

Vincent Fernando, CFA

Stories Behind the Reported Nov 2023 Taiwan Semi/Tech Sales

Stories Behind the Reported Nov 2023 Taiwan Semi/Tech Sales. More clear y/y improvement for 8/12" raw wafer, WiFi IC, GaAs RF/VCSEL, and memory...

Andrew Lu

What's Next for SiMo?

MaxLinear has called off its planned acquisition of Silicon Motion. Does this indicate future problems for SiMo? Not necessarily.

Jim Handy

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Silicon Motion Memory Readthrough: NAND Flash to Remain In Shortage; Up-Cycle to Persist

​Silicon Motion beats expectations and predicts strong growth for NAND flash in 2024E and 2025E plus new enterprise data center products....

Vincent Fernando, CFA

UMC (2303.TT; UMC.US): 1Q24F Outlook Could Be Flat QoQ; Asian Clients Show Optimism.

​UMC's updated revenue outlook for 1Q24F suggests flat growth compared to 4Q23, with increased demand from Asian clients but bearish sentiment from...

Patrick Liao

Silicon Motion: Next Wave of the Memory Recovery; High-End NAND Prices More Than Doubled From Lows

Silicon Motion shares are down 5% over the last year. They have been weighed down by their terminated acquisition by MaxLinear, but now could offer...

Vincent Fernando, CFA

Stories Behind the Reported Nov 2023 Taiwan Semi/Tech Sales

Stories Behind the Reported Nov 2023 Taiwan Semi/Tech Sales. More clear y/y improvement for 8/12" raw wafer, WiFi IC, GaAs RF/VCSEL, and memory...

Andrew Lu

What's Next for SiMo?

MaxLinear has called off its planned acquisition of Silicon Motion. Does this indicate future problems for SiMo? Not necessarily.

Jim Handy

Silicon Motion beats expectations and predicts strong growth for NAND flash in 2024E and 2025E plus new enterprise data center products....

UMC's updated revenue outlook for 1Q24F suggests flat growth compared to 4Q23, with increased demand from Asian clients but bearish sentiment from...