Tracking developments across tech supply chains, Tech Supply Chain Tracker

Tech Supply Chain Tracker

Tracking developments across tech supply chains

Equity Bottom-Up

<ul><li>China leads the battery materials market as South Korea's Posco considers exiting, while Lotte gears up for mass production of LFP batteries.</li><li>Rapidus focuses on installing EUV equipment for multiple units deployment amidst industry challenges, while Micron sees record data center sales but misses guidance targets.</li><li>Nvidia eyes Taiwan for humanoid robot assembly, Japan enters 2nm chip race alongside Samsung, Intel, and TSMC amid supply chain obstacles.</li></ul>

China leads the battery materials market as South Korea's Posco considers exiting, while Lotte gears up for mass production of LFP batteries.Rapidus focuses on installing EUV equipment for multiple units deployment amidst industry challenges, while Micron sees record data center sales but misses guidance targets.Nvidia eyes Taiwan for humanoid robot assembly, Japan enters 2nm chip race alongside Samsung, Intel, and TSMC amid supply chain obstacles.

Tech Supply Chain Tracker (20-Dec-2024): China leads battery materials, Posco Future M exits, Lotte eyes LFP production.

Asia and Global Semiconductor and Tech Research

Andrew Lu

Thematic (Sector/Industry)

<ul>
<li>Taiwan Dell said "AI GPU shortage issue has been resolved. The lead time has been cut from 40 weeks by the end of 2023 to 8-12 weeks or less now.</li>
<li>We see this news short term positive but medium term negative to AI GPU supply chain vendors but need more information to confirm if this is an inflection point.</li>
<li>1. Taiwan Dell got priority supply? 2. Earlier overbooking over? 3. Lead time cut by supply upside? 4. Cooling company said the same; 5. Will lead time continue to shrink?</li>
</ul>


Taiwan Dell said "AI GPU shortage issue has been resolved. The lead time has been cut from 40 weeks by the end of 2023 to 8-12 weeks or less now.
We see this news short term positive but medium term negative to AI GPU supply chain vendors but need more information to confirm if this is an inflection point.
1. Taiwan Dell got priority supply? 2. Earlier overbooking over? 3. Lead time cut by supply upside? 4. Cooling company said the same; 5. Will lead time continue to shrink?


Early Sign of AI GPU Market Inflection Point?

<ul>
<li>Post 35% price gain in a quarter, many good news we expected and other analysts expected already factored into the share price. We believe the risk/reward not attractive here.</li>
<li>TSMC guides stronger 1Q24 and 2024, helped by Nvidia and copy cat AI GPU/ASIC orders. We see greater opportunities for alternative copy cat solutions like AMD and Alchip.</li>
<li>We attribute Nvidia customers' sales discrepancy to AI server is cannibalizing non-AI server and Nvidia is allocating more GPUs to premium price paying customers in 1H24 and reverse in 2H24.</li>
</ul>


Post 35% price gain in a quarter, many good news we expected and other analysts expected already factored into the share price. We believe the risk/reward not attractive here.
TSMC guides stronger 1Q24 and 2024, helped by Nvidia and copy cat AI GPU/ASIC orders. We see greater opportunities for alternative copy cat solutions like AMD and Alchip.
We attribute Nvidia customers' sales discrepancy to AI server is cannibalizing non-AI server and Nvidia is allocating more GPUs to premium price paying customers in 1H24 and reverse in 2H24.


From Nvidia Results to See Supply Chain Stories?

<ul>
<li>After our global server market model update, we see 3Q23 server market decline and data center vendors' capex cut not consistent with Nvidia's robust y/y sales growth of over 200%;</li>
<li>Discrepancy: 1. Nvidia gaining value on AI server, losing zero on non AI; 2. AI servers grow at the expenses of non AI; 3. most vendors not only in server;</li>
<li>Different from  consensus view, we expect general (non AI) server market to decline 16% y/y in 2024 and 29% in 2025 and suggest to avoid general server supply chain vendors.</li>
</ul>


After our global server market model update, we see 3Q23 server market decline and data center vendors' capex cut not consistent with Nvidia's robust y/y sales growth of over 200%;
Discrepancy: 1. Nvidia gaining value on AI server, losing zero on non AI; 2. AI servers grow at the expenses of non AI; 3. most vendors not only in server;
Different from  consensus view, we expect general (non AI) server market to decline 16% y/y in 2024 and 29% in 2025 and suggest to avoid general server supply chain vendors.


What to Avoid if AI Server Will Continue to Squeeze General Server Market in 2024-2025?

Technology / Semiconductor / Internet Research

Nicolas Baratte

<ul>
<li>IDC reported 3Q24 PC shipments declining -2% YoY, Canalys an increase of +1%. Let’s call this flat. If 4Q24 is “average seasonal”, 2024 will reach ~265m, or the pre-Covid range. </li>
<li>No AI fever, no accelerated replacement cycle, for now. If it happens, it will take time, ie compelling AI apps that only run locally and need a new PC.</li>
<li>In Asia, PC vendors: Lenovo, Acer, Asus. Taiwan ODM: Compal, Quanta, Wistron. Semi with high exposure: Novatek, Realtek. </li>
</ul>


IDC reported 3Q24 PC shipments declining -2% YoY, Canalys an increase of +1%. Let’s call this flat. If 4Q24 is “average seasonal”, 2024 will reach ~265m, or the pre-Covid range. 
No AI fever, no accelerated replacement cycle, for now. If it happens, it will take time, ie compelling AI apps that only run locally and need a new PC.
In Asia, PC vendors: Lenovo, Acer, Asus. Taiwan ODM: Compal, Quanta, Wistron. Semi with high exposure: Novatek, Realtek. 


3Q24 PC Shipments Are Flat YoY. Lenovo, Acer, Asus. Compal, Quanta, Wistron.

Taiwan

Wistron Corporation manufactures and markets notebook computers, personal computers, and other related information products.

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Wistron Corp (3231 TT)

Tech Supply Chain Tracker (20-Dec-2024): China leads battery materials, Posco Future M exits, Lotte eyes LFP production.

China leads battery materials market, Posco Future M may exit, Lotte to mass produce LFP batteries, Rapidus adopts EUV, Micron posts record sales...

Tech Supply Chain Tracker

Early Sign of AI GPU Market Inflection Point?

Early Sign of AI GPU Market Inflection Point? We see this lead time cut news short term positive but long term negative to AI GPU supply chain...

Andrew Lu

From Nvidia Results to See Supply Chain Stories?

From Nvidia Results to See Supply Chain Stories? Post 35% price gain in a quarter, many good news already factored into the share price. We...

Andrew Lu

What to Avoid if AI Server Will Continue to Squeeze General Server Market in 2024-2025?

Names to Avoid if AI Server Will Continue to Squeeze General Server Market in 2024-2025? Different from consensus, we expect non AI server market...

Andrew Lu

3Q24 PC Shipments Are Flat YoY. Lenovo, Acer, Asus. Compal, Quanta, Wistron.

3Q24 PC shipments are flat YoY. The great recovery or AI replacement cycle aren’t happening (for now). IDC reported 3Q24 PC shipments declining -2%...

Nicolas Baratte

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