Equity Long-Short, Semiconductors, Fabricated Knowledge

Douglas O'Laughlin

Equity Long-Short, Semiconductors

Fabricated Knowledge

Learn more about the world's most important manufactured product. Meaningful insight, timely analysis, and an occasional investment idea.

Equity Bottom-Up

Taiwan Semiconductor (TSMC) - ADR / Equity Bottom-Up

<ul><li>It’s time for the main event: earnings are upon us. As is customary, let’s start with TSMC, move to ASML and Alphawave, and then discuss VAT Group.</li><li>TSM revenue is above guidance, gross margins are a bit ahead of the midpoint, and operating margins are at the high end of guidance.</li><li>First, while this is a good result, semiconductors are due for a correction. I wrote about this in March, and SOXX has quietly crept downwards since then.</li></ul>

It’s time for the main event: earnings are upon us. As is customary, let’s start with TSMC, move to ASML and Alphawave, and then discuss VAT Group.TSM revenue is above guidance, gross margins are a bit ahead of the midpoint, and operating margins are at the high end of guidance.First, while this is a good result, semiconductors are due for a correction. I wrote about this in March, and SOXX has quietly crept downwards since then.

TSMC, ASML, VAT Group, and Alphawave Earnings

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

<ul>
<li>TSMC and ASML reported 1Q24 results last week; both stocks have fallen post results, impacted by global concerns despite a strong outlook for these two leaders into 2025E.</li>
<li>TSMC guided for strong growth not just in 2024E, but if one digs into management's comments, they actually provided strong visibility into their 2028E internal revenue expectations.</li>
<li>For ASML, its EUV product business is the key indicator to watch. We believe TSMC shares will continue to re-rate even through a period of global economic softness.</li>
</ul>


TSMC and ASML reported 1Q24 results last week; both stocks have fallen post results, impacted by global concerns despite a strong outlook for these two leaders into 2025E.
TSMC guided for strong growth not just in 2024E, but if one digs into management's comments, they actually provided strong visibility into their 2028E internal revenue expectations.
For ASML, its EUV product business is the key indicator to watch. We believe TSMC shares will continue to re-rate even through a period of global economic softness.


TSMC Just Provided Substantial Visibility into Their Long-Term Growth Estimate; ASML Adds Color

<ul>
<li>TSMC (2330.TT; TSM.US): US$6.6bn from US CHIPS Act; the Earthquake Impact and the 2nd Japanese Fab. </li>
<li>Memory Monitor: Nanya's Results to Provide Latest Color on DRAM Post Earthquake; Short Int Rising </li>
<li>UMC (2303.TT; UMC.US): Some Rush Orders Coming in and 2Q24F Could Post Positive QoQ. </li>
</ul>


TSMC (2330.TT; TSM.US): US$6.6bn from US CHIPS Act; the Earthquake Impact and the 2nd Japanese Fab. 
Memory Monitor: Nanya's Results to Provide Latest Color on DRAM Post Earthquake; Short Int Rising 
UMC (2303.TT; UMC.US): Some Rush Orders Coming in and 2Q24F Could Post Positive QoQ. 


Taiwan Tech Weekly: TSMC Wins Major U.S. Support; Nanya Results; UMC Rush Orders

Taiwan Tech Focused Senior Analyst

Patrick Liao

United Microelectronics Corp / Equity Bottom-Up

<ul>
<li>
<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)</a>'s 2Q24F outlook is experiencing a slight upward now, possibly indicating a positive QoQ.  </li>
<li>UMC's notable contributors are showing a mixed outlook, 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> could be the most influencer.</li>
<li>Attention should be paid to the 3Q24F outlook for any potential changes and a shift from a bearish view could positively impact the outlook, potentially signaling the end of downturn.  </li>
</ul>



United Microelectronics Corp (2303 TT)'s 2Q24F outlook is experiencing a slight upward now, possibly indicating a positive QoQ.  
UMC's notable contributors are showing a mixed outlook, and Novatek Microelectronics Corp (3034 TT) could be the most influencer.
Attention should be paid to the 3Q24F outlook for any potential changes and a shift from a bearish view could positively impact the outlook, potentially signaling the end of downturn.  


UMC (2303.TT; UMC.US): Some Rush Orders Coming in and 2Q24F Could Post Positive QoQ.

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

Thematic (Sector/Industry)

<ul>
<li>A major earthquake struck Taiwan on April 3, where 25-30% of the world's semiconductor wafers are produced</li>
<li>Most semiconductor fabs are far away from the earthquake's epicenter</li>
<li>Those companies that have issued statements indicate that damage was slight, but there is still likely to be a shortage, which should boost chip maker profitability through 2024</li>
</ul>


A major earthquake struck Taiwan on April 3, where 25-30% of the world's semiconductor wafers are produced
Most semiconductor fabs are far away from the earthquake's epicenter
Those companies that have issued statements indicate that damage was slight, but there is still likely to be a shortage, which should boost chip maker profitability through 2024


Taiwan

Taiwan Semiconductor Manufacturing Company, Ltd. manufactures and markets integrated circuits. The Company provides the following services: wafer manufacturing, wafer probing, assembly and testing, mask production, and design services. TSMC's ICs are used in computer, communication, consumer electronics, automotive, and industrial equipment industries.

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Taiwan Semiconductor (TSMC) (2330 TT)

TSMC, ASML, VAT Group, and Alphawave Earnings

It’s time for the main event: earnings are upon us. As is customary, let’s start with TSMC, move to ASML and Alphawave, and then discuss VAT Group.

Fabricated Knowledge

TSMC Just Provided Substantial Visibility into Their Long-Term Growth Estimate; ASML Adds Color

If you dig into the details, TSMC provided substantial insight into the company's internal estimates for long-term revenue. For ASML, we discuss...

Vincent Fernando, CFA

Taiwan Tech Weekly: TSMC Wins Major U.S. Support; Nanya Results; UMC Rush Orders

TSMC receives $6.6bn from US CHIPS Act; also plans for 2nd Japanese fab; Nanya's results to shed light on DRAM post-earthquake; UMC sees rush...

Vincent Fernando, CFA

UMC (2303.TT; UMC.US): Some Rush Orders Coming in and 2Q24F Could Post Positive QoQ.

UMC's 2Q24F outlook is slightly improving, with Novatek Microelectronics Corp potentially being a key influencer. Keep an eye on the 3Q24F outlook...

Patrick Liao

Will Taiwan Quake Trigger a Shortage?

Taiwan's April 3 earthquake should negatively impact semiconductor production to create a shortage that is likely to increase chip makers'...

Jim Handy

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TSMC, ASML, VAT Group, and Alphawave Earnings

It’s time for the main event: earnings are upon us. As is customary, let’s start with TSMC, move to ASML and Alphawave, and then discuss VAT Group.

Fabricated Knowledge

TSMC Just Provided Substantial Visibility into Their Long-Term Growth Estimate; ASML Adds Color

If you dig into the details, TSMC provided substantial insight into the company's internal estimates for long-term revenue. For ASML, we discuss...

Vincent Fernando, CFA

Taiwan Tech Weekly: TSMC Wins Major U.S. Support; Nanya Results; UMC Rush Orders

​TSMC receives $6.6bn from US CHIPS Act; also plans for 2nd Japanese fab; Nanya's results to shed light on DRAM post-earthquake; UMC sees rush...

Vincent Fernando, CFA

UMC (2303.TT; UMC.US): Some Rush Orders Coming in and 2Q24F Could Post Positive QoQ.

​UMC's 2Q24F outlook is slightly improving, with Novatek Microelectronics Corp potentially being a key influencer. Keep an eye on the 3Q24F outlook...

Patrick Liao

Will Taiwan Quake Trigger a Shortage?

​Taiwan's April 3 earthquake should negatively impact semiconductor production to create a shortage that is likely to increase chip makers'...

Jim Handy

TSMC receives $6.6bn from US CHIPS Act; also plans for 2nd Japanese fab; Nanya's results to shed light on DRAM post-earthquake; UMC sees rush...

UMC's 2Q24F outlook is slightly improving, with Novatek Microelectronics Corp potentially being a key influencer. Keep an eye on the 3Q24F outlook...

Taiwan's April 3 earthquake should negatively impact semiconductor production to create a shortage that is likely to increase chip makers'...