TMT/Internet

• Microsoft’s China AI teams relocate due to US rules, focusing on Wi-Fi 7 development for improved connectivity and performance.
• Amazon’s stake in Alchip suggests potential synergy in AI tech and expanded market reach, while Kymco launches eco-friendly e-scooter.
• Tencent Cloud partners with BRI and Hi Cloud Indo for banking innovation, while Veolia opens first regeneration plant in China for sustainable water treatment. Tron Future secures funding for counter-drone tech.

• Sea Limited (SE US) booked a strong set of 1Q2024 results from a GMV, revenue and adjusted EBITDA perspective, with fears of greater competition from TikTok failing to materialise. 
• The company has been investing in growth across all segments, with e-commerce driving and digital financial services driving growth but digital entertainment also seeing a return to growth mode. 
• Sea Limited continues to focus on its core competitiveness in pricing, improving service quality, and lowering the cost to serve through SPX Express, with advertising becoming a more meaningful contributor.  

• Taiwan Tech and Nvidia Rally Ahead of Nvidia Earnings Next Week; Microsoft Build Conference Could Showcase Edge AI Copilot
• Hon Hai: Traditional Server Market Now Adding to AI Growth; Expects Market Share Gains in 2024E 
• Asustek: Margin Beat, Guides More Upside; Qualcomm for AI PCs; Why Asus Confident in AI PC Up-Cycle 

• Tokyo Communications Group’s core businesses currently include its Media business, where it plans and develops free game apps for smartphones and uses a portion of the app’s screen space to generate advertising revenue, and its Platform business, where it operates a consultation service based on a pay-as-you-go model.
• The company also functions as an investment company with the aim of achieving company-wide growth while diversifying risks by allocating the cash flow generated by these core businesses into various promising digital businesses.

• The company’s main business at the time of its founding consisted of developing and operating free game apps for smartphones.

• HeartCore Enterprises is an established software development and consulting company based in Tokyo, Japan and operates in five core offerings and solutions.
• These include 1) Content Management in which the core product is HeartCore CMS, 2) Digital Transformation which includes Controlio, myInvenio, Apromore and HeartCore Robo, 3) GO IPO, a consulting service that helps Japanese companies prepare for a U.S. Nasdaq public listing, 4) Sigmaways, that specializes in infrastructure modernization, and 5) other revenues.
• We believe the company is poised for strong growth due to its entry in the U.S. market and solid results from the Go IPO offering.

• GoDaddy’s first quarter results for 2024 demonstrate a strong start to the year and contribute to the positive reputation of the company.
• Notably, through their free cash flow, the company has achieved growth of 26% year-over-year, thanks to their profitable growth model that converts customer value to shareholder value.
• This has been largely driven by a surge in the applications and commerce sector, which has seen bookings growth of 22% and normalized EBITDA margin expansion of 400 basis points.

• Worldline (WLN FP) stock dropped over 60% after disappointing Q3 earnings and reduced guidance for 2023
• Company scrapped medium-term plan through 2024, facing challenges including costly French restructuring and uncertainty about merchant revenues
• Stock considered cheap at 6x multiple of EPS and EBIT in 2025, potential for shares to double or more in next 24-36 months with activist pressure and company hiring advisors. Worldline SA is second-largest merchant acquirer in Europe with focus on merchant, financial, and e-Transactional services.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• ON24 is a cloud-based SaaS platform for digital engagement through webinars and virtual events
• Company has a low valuation and has seen a significant decline since IPO but shows signs of turnaround
• ON24 Elite has generated approximately $171 million in revenue over the last twelve months, making it a high conviction long investment for the author

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Cloudflare Inc., in its Q1 2024 earnings, witnessed a strong start to the year, with the company’s revenues hitting a high of $378.6 million, marking a significant 30% increase on a year-over-year basis.
• The company notched up its large customer base to 2,878 signifying a 33% increment year over-year.
• It successfully added 122 new large customers, concurrently boosting the revenue contribution from this segment from 62% to 67%.

• Post market close tomorrow, Hang Seng Indexes will announce the changes for the Hang Seng Index (HSI INDEX) that will be implemented at the close on 7 June.
• There were no constituent changes to the index in March. We highlight ten profitable and eligible stocks that could be added to the index in June.
• Changes to the Hang Seng Industry Classification System (HSICS) could lead to inclusions for the Information Technology industry while there could also be inclusions for the underweighted Healthcare industry.

• US tariff hike on Chinese electric vehicles, solar cells, and semiconductors could raise costs for clean energy industry in China, affecting competitiveness and growth.
• AT&S to sell medtech PCB factory in South Korea, indicating potential changes in the global supply chain.
• AI rush leading to staffing shortages at companies like Amazon and Google, while India sees surge in AI spending by 2027.

• The Cigniti-Coforge acquisition presents a unique investment opportunity in the IT services sector, with potential for significant returns.
• Coforge plans to acquire a 54% stake in Cigniti Technologies, expanding its presence in digital assurance and AI services.
• The deal is expected to be completed by Q2 of FY25, with an open offer price potentially higher than the current market value of Cigniti shares.

• Inventory levels were at 90 days by the end of 1Q24, returning to a normal level.   
• It is expected to see consecutive QoQ growth throughout 2024, with normal orders observed since 2Q24. 
• Although Chinese mature technology is advancing, current analog capacity still falls short of local demand in China.

• Vitec Software Group AB is the largest Nordic-based vertical market software company with exceptional growth and outperformance compared to peers
• Despite being lesser-known, Vitec has significant potential for growth and is expected to become more well-known internationally, attracting more institutional investors
• Under CEO Olle Backman’s leadership, the company is expected to continue its high organic growth trajectory, offering a promising investment opportunity with a base case target price of ~870 SEK and a potential return of ~55% over the next two years.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Fortinet, the multinational cybersecurity company, has showcased notable financial results for the first quarter of 2024.
• They declared an operating margin increase of a first quarter record of 28.5%, and a record cash flow from operations of $830 million.
• Their adjusted free cash flow margin was also their highest yet at 61%.

• Motorola Solutions, Inc. showcased robust financial performance in the first quarter of 2024, marked by a 10% revenue growth and a significant 27% increase in its earnings per share.
• This strong performance was complemented by an expanded operating margin by 220 basis points and a record first quarter operating cash flow of $382 million.
• The growth was propelled by various segments.

• PTC experienced robust results in this quarter, continuing the positive trend evident in their product portfolio’s resonance with customers.
• Despite changing their mid-term targets, the company has an unequivocal commitment to delivering on its cash flow guidance.
• This will be achieved by updating their mid-term ARR growth objectives, with constant currency ARR growth targeted to be in the low double digits over the mid-term.

• CDW Corporation has reported its Q1 2024 earnings.
• Despite a challenging market environment, gross profit came in at $1.1 billion, while non-GAAP operating income stood at $404 million.
• Gross margin for the period was a Q1 record, demonstrating the resilience of CDW’s underlying profitability and strategic integrity.

• Following HCL Technologies (HCLT IN)‘s fiscal 4Q2024 earning report last month, we have witnessed an acceleration in near-term earnings estimates downgrades.
• Based on near-term momentum indicators, it seems that we are only at the beginning stage of a prolonged period of underperformance.
• HCL Technologies currently trades roughly one standard deviation above its rolling 5-year historic average PE ratio.

• Tencent is due to release Q1 FY24 results today. The earnings call is scheduled for 14:00 SAST
• In this note, we unpack what is priced and how Tencent has performed relative to constituents in the HSTECH index since our last update (29 April).
• We also provide an update on how the discounts of Naspers and Prosus have traded.

• Tencent reported a decent set of results for Q1 FY24. Revenue for the quarter was up 2.8% QoQ and 6.3% YoY, ahead of consensus estimates (2.3% & 5.9%).
• The gross margin came in at 53%, 3 percentage points ahead of consensus, and an increase of 7 percentage points on Q1 FY23.
• The gross margin for the Fintech and Business Services segment, which accounts for 33% of revenue, increased by 12 percentage points to 46% (consensus 42.6%).

• There are 15 stocks in Japan that will be sold by passive trackers at the close on 31 May.
• Short interest has been increasing in these stocks over the last few months and there will be covering on implementation date.
• Cumulative excess volume on all stocks has risen in the last couple of months though the pace of the increase has varied.

• The operating margin in 1Q24 reached the highest since 2Q16, as the gross margins of all businesses improved.
• The growth rate of online advertising is high than our estimate, but the growth rate of FinTech is lower than our estimate.
• We believe there is still an upside of 9% and the price target will be HK$415 for the end of 2024.

• In a surprise move, Intel announced that its foundry chief Stuart Pann is to retire from the company effective end of May after just over one year in the role
• He will be replaced by former IBM, Globalfoundries and Marvell executive Kevin O’Buckley, effective immediately
• Mr. O’Buckley now has the dubious distinction of being the third leader of IFS in as many years. 

• Tencent (700 HK) reported 1Q2024 results today. Both revenues and OP grew 6.3% and 30.0% YoY respectively and beat consensus estimates.
• Though domestic games revenues declined YoY, there were signs of recovery in Tencent’s gaming business. Online advertising saw strong growth despite 1Q being a seasonally weak quarter for Tencent.
• Tencent’s investments in high-margin products have helped boost the company’s margins across all business segments.

• Taiwan launches IC Taiwan Grand Challenge to attract innovative teams and talent, offering opportunities to showcase skills and win prizes.
• Navigating AI investments during upgrades: on-premise or cloud computing? Make informed choices for hardware and software advancements.
• Taiwan’s LEO satellite program readiness questioned; virtual power plants used in Taiwan and Japan to mitigate earthquake risks; TPCA partners with Taiwanese industry association to boost talent and supply chains for Thai electronics manufacturing growth; Intel appoints new head of foundry services.

• Hon Hai reported 1Q24 revenue that fell 9% YoY, however the company reiterated its guidance for significant growth in 2024E and said growth now looks stronger than guided in March.
• Hon Hai’s cloud (including servers) business didn’t grow as much as guided due to material shortages; but AI server revenue up 200% YoY and significant growth is guided for 2024E.
• The traditional server market is rebounding, to grow double digits in 2024E. Hon Hai expects to take market share in 2024. Structural Long but near-term gains could be limited.

• April revenue ~NT$236.02 billion, +20.9% MoM & + 59.6% YoY
• It was the company’s second highest monthly revenue ever, made all the more remarkable by the fact that it occurred during its seasonally low first half year
• Our April YoY Taiwan monthly revenue comps are flashing green across the board with just one exception, Globalwafers

• Arm’s valuation has driven the group NAV to a new high at fiscal year-end in March; with Arm accounting for 45% of group equity value, NAV downside risk is high
• JPY depreciation has been NAV supportive, but this could reverse; SVF2 remains very exposed to financing costs, with 87% of its equity value in private companies
• Softbank shares trade at a 57% discount to the estimated NAV; yet the downside risks to Arm’s valuation, along with SVF2 valuation headwinds, should keep the discount wide

• Asus’s 1Q24 earnings beat consensus by 46% thanks to major increase in operating margin driven by costs optimization. Adjusted Asus brand Op profit rose 227% YoY and 98% QoQ.
• Asus will host a major AI PC launch event May 21st, with additional AI PCs launched at Computex in Taiwan June 4th. Will feature Qualcomm Inc (QCOM US) Snapdragon processors.
• Asus confident in an PC upgrade cycle and has guided for sales to rise and margins to expand in the coming quarters. We maintain our Structural Long rating for Asus.

• ASE plans to boost sales in the second half of 2024 with cutting-edge technology and innovative solutions. Introspect CEO discusses how their GDDR7 memory test system outperforms competitors, helping customers stay ahead of the curve.
• Taiwan’s space dreams face hurdles from regulations and geopolitics, hindering progress. N Chandrasekaran becomes chair of Tata Electronics, signaling entry into semiconductor industry. Indian GaN startup targets global expansion in telecom and EV markets for growth.
• Triton ignites Taiwan’s push for satellite self-sufficiency; Apple partnership speculation with a leading EV startup generates buzz. Lam Research seeks chipmaking tool partners in India to drive innovation and collaboration. #Apple #EVstartup #newsroundup

• UI reported fiscal third quarter (March) results in line with our revenue forecasts suggesting the business could be on the rebound after two years in a challenging environment
• The performance in the June quarter comes even though peers have been reporting a tough selling environment with extended sales process as customers took time to make their decision
• The increase in product availability did backfire in the quarter with Ubiquiti taking a charge for obsolete inventory. Nevertheless, Ubiquiti’s results show a business that is improving

• Immersion Corp. is a high-margin licensing business with no debt and significant cash reserves
• Recent settlement with Meta in patent lawsuit could exceed company’s current enterprise value
• Previous settlements with Apple resulted in significant increase in Immersion’s share price, potential upside not fully reflected in current share price due to limited access to court documents, presenting possible investment opportunity

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Choking off investment is leading to undervaluation of companies like MAPS in the cannabis sector
• MAPS has a dominant position in the market with a strong brand and large user base
• MAPS presents a compelling investment opportunity with potential upside due to its low valuation and ability to capitalize on evolving industry trends and regulations

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

MoneyHero is a leading South-East Asian personal finance aggregator and comparison platform, covering the full suite of personal finance products. Its goal is to educate and empower consumers on personal finance through engaging content and rewards on financial products. The company partners with leading local and global financial institutions to ensure it has the most attractive products and offers for its user base. Management has ambitious plans to grow market share and attractive product verticals, such as insurance. Having raised c $87m in net proceeds from a deSPAC transaction in October 2023, the company paid down all debt and had a net cash position of $68.6m at end FY23, meaning it is well capitalised to fund the acceleration in growth.

• Zoominfo’s stock rose by 24% after hours following positive earnings, attributed to its unique database and high ROI for salespeople
• Challenges such as decelerating sales, shrinkage in the software sector, and competition from copycat companies have impacted Zoominfo’s growth
• The company is looking to bounce back and derisk its story for investors with a strong data offering

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• The latest earnings for Automatic Data Processing (ADP) saw a robust performance of the company’s third quarter fiscal performance for the year 2024.
• Two key figures stood out in the discussion, a 7% revenue growth and a 14% adjusted diluted EPS growth, indicating a solid financial performance despite a competitive business environment.
• Positively, the company achieved strong Employer Services (ES) new business bookings growth, achieving record bookings for the Q3 period, which keeps the company on track for its full-year outlook.

• In May 2023, KDDI Corp (9433 JP) announced a ¥300bn buyback program, did nothing for two months, then announced a Tender Offer Buyback to buy shares from Toyota. 
• Toyota had increased its stake years before, then KDDI bought back shares from others, so Toyota was backing its ownership down. I discussed the relationships, history, etc, here.
• This year, KDDI announced Friday with earnings that is buying back another large stake from Toyota. 

• Naver doesn’t view the sale of its A Holdings stake unfavorably; insiders suggest it’s been planning this move since last year.
• Market speculation suggests Naver was disappointed by Softbank’s rejection of CLOVA X in LINE, prompting plans to sell A Holdings stake for AI development. A sale agreement is expected soon.
• The method through which Softbank secures funds for this acquisition is worth the attention from a short-term trading perspective.

• Automotive display driver IC leader Himax reported 1Q24 results last week that were ahead of guidance. The company also guided for rising margins.
• Management believes 1Q24 represents a cyclical bottom for the company’s financial performance and expects automotive demand to rise in 2H24E.
• Himax rallied but remains 55% below its 2021 highs, yet its market opportunity larger than ever. Himax could be benefitting from different positioning within automotive chips than NXP & Infineon.

• In the first quarter of 2024, Advanced Micro Devices (AMD), under the chairmanship and CEO-ship of Dr.
• Lisa Su, achieved multiple milestones.
• Revenue rose to $5.5 billion, showing both quarter over-quarter and year-over-year growth, while the company’s gross margin expanded by more than 2 percentage points; they also saw enhanced profitability with Data Center and Client segment sales each growing by over 80% year-over-year.

• Based on the Q1 2024 earnings, Corning Incorporated appears to be in a position of growth and profitability.
• With sales close to $3.3 billion and EPS of $0.38, the company exceeds its guidance predictions.
• There was a year-over-year gross margin growth of 160 basis points to 36.8%, and a substantial improvement in free cash flow by $300 million.

• In Q1 2024, Gartner delivered strong profitability and free cash flow, which both surpassed expectations, leading the company to increase its guidance for the year.
• The company proved its resilience in what’s described as a “complex environment”, with contract value growth in the high single digits.
• However, there remain several challenges to face.

• Mastercard Inc.’s Q1 2024 earnings showcased the company’s firm position in the payments sector, underpinned by robust revenue and adjusted net income growth on a non-GAAP, currency-neutral basis.
• The company’s strong results go beyond the uptake in consumer spending, extending to the rapid growth in cross-border volumes.
• There are several factors at play that make Mastercard attractive from an investment standpoint.

• Pinterest reported healthy growth trends with bright prospects, although there are challenges and areas in need of improvement, making an investment thesis mix of cautious optimism and risk mitigation.
• Positively, Pinterest revealed impressive progress in terms of both user engagement and operational efficiency.
• The platform has surpassed 500 million global Monthly Active Users (MAUs) for the first time, increasing by 12%, marking its seventh quarter of consecutive acceleration.

• The Qualcomm Inc. second quarter 2024 earnings focused on recent achievements and future expectations.
• The company reported non-GAAP revenues of $9.4 billion, surpassing its guidance, with chipset business revenues of $8 billion, on the strength of Android smartphones and automotive momentum.
• Underpinned by its technology leadership, Qualcomm expects to continue growing in both the mobile and automotive markets.

• Skyworks Solutions Inc. management shared both encouraging and concerning updates in its recent earnings.
• On the positive side, the company demonstrated solid financial performance in the second fiscal quarter of 2024, including revenue of $1.046 billion, earnings per share of $1.55, and generation of $300 million in operating cash flow.
• The company sees significant opportunities in the edge IoT market with a robust design win pipeline for WiFi 6E and WiFi 7, indicating a possible multiyear upgrade cycle.

• In the latest Q3 2024, the Super Micro Computer management shared about its ongoing growth and mentioned that the strong results reflect the increasing demand for their rack-scale plug and play total ai solutions.
• For the quarter, the firm achieved record-breaking revenues of $3.85 billion, a year-on-year increase of 200% and non-GAAP earnings per share of $6.65, a 308% YoY increase.
• Super Micro anticipates AI growth over many quarters, if not years, based on its financial performance and market trends, which is positive for the firm.

• Zebra Technologies Corporation’s first quarter financial performance for 2024 has been impacted by ongoing softness across many markets and regions.
• Due to this, Zebra has experienced a double-digit decline in sales and profitability.
• However, the company noted a gradual recovery in demand and was encouraged by a surge in large order activity, positively influencing the quarter.

• China’s smartphone market saw growth in 1Q 2024, with increased shipments of OLED panels indicating potential for LG.
• Panasonic’s battery unit received US subsidy but faces weak EV demand, potentially hurting sales.
• Concerns rise as tech giants invest in AI infrastructure, with focus on consolidation, data privacy, and potential misuse of power.

• PayPal Holdings Inc.’s Q1 2024 earnings showcased a solid start for the year with substantial improvements across various sectors of the business, tempered by an understanding of the need for continued retooling and operational changes.
• The company leadership is operating cohesively and the new strategies in place are evidently beginning to make a difference.
• PayPal has maintained steady progress with their three customer groups; large enterprises, small businesses, and consumers, including their subsidiary, Venmo.

• Amazon.com reported robust first quarter financial results in 2024, with revenue of $143.3 billion, a 13% increase year-over-year.
• However, the result excludes the impact of foreign exchange rates, which caused an unfavorable impact that reduced revenue by roughly $700 million.
• The company delivered higher than expected operating income of $15.3 billion, which is a 221% increase from last year, driven primarily by efficiency improvements and better customer experiences.

• ARLO grew the number of paid subscribers faster than expected in the first quarter, but it was the contract extension with Verisure that was the big news of the day
• ARLO and Verisure have had an agreement for five years expiring later this year. The new agreement is through 2029
• The growth in paid subscribers in Q1 puts ARLO on pace to achieve 4 million total paid subscribers by the end of 2024, after hitting 3 million in February 2024

• Cambium Networks (CMBM) reported earnings on May 9 that came in below our expectations (we were the lowest on the Street), mainly due to a delay in FTC approval of 6 GHz spectrum.
• This also hit gross margin, which came in at 22.7%. Company expectations are for a better 2Q24 and 2H24, but with continued challenges in inventory and the move to 6 GHz.
• The company did see a recovery in the enterprise market in 1Q24, but not enough to offset the weakness in 6 GHz. The stock dropped 13% in the aftermarket.

PVA TePla has transitioned from a small seller of industrial systems to a materials technology and metrology solutions company, set to reach c €280m in revenues in FY24. Its increasing exposure to the fast-growing semiconductor industry (more than two-thirds of sales) and high-end materials markets is securing growth, driven by AI, digitisation and e-mobility. The combination of a higher capital intensity in the semiconductor industry and growing end markets bodes well for players like PVA TePla, which are exposed to the fast-growing part of equipment sales like metrology. Despite this, PVA TePla is still largely valued as an industrial company, trading at a significant discount to peers and our DCF.

• Bloomberg reports that Teijin Ltd (3401 JP) wants to sell its 55% stake in Infocom Corp (4348 JP). The rumoured bidders are Sony Corp (6758 JP), Blackstone and KKR. 
• Based on precedents, the offer structure will likely be structured such that Teijin provides an irrevocable NOT to accept but vote in favour of share consolidation at the EGM.
• Bloomberg suggests that Infocom could be valued at JPY200 billion. If this refers to market cap, the tender offer is JPY3,472, a 16.5% premium to the last close.

• AEM (AEM SP) published dismal 1Q24 results and kept its modest guidance for 1H24.
• AEM has announced new customer wins going into FY25 which should improve results materially next year. The sell-side has downgraded estimates aggressively making room for upside surprises next year.
• AEM has seen an implosion in investor confidence because of the inventory issues, and slow orders from its key customer Intel Corp (INTC US). Long-term investors should accumulate here. 

• Quiddity’s “Who is Ready” series of insights aims to objectively identify names listed on the Tokyo Stock Exchange that are potential additions to the TOPIX Index in future.
• Dozens of companies have been able to meet the key Section Transfer requirements on paper for several months but there have been no TOPIX Inclusions announcements in 2024 so far. 
• However, there are some pre-event candidates we believe are worth monitoring as they have previously confirmed their desire to move to the Prime Market.

• Samsung and LG are launching new gaming and AI-focused monitors to take advantage of the recovering market.
• Tata Elxsi is collaborating with Arm on self-driving vehicle solutions, while Saudi fund considers cutting ties with China for US chips and AI.
• Samsung and SK Hynix are competing in the HBM market, driven by demand for high-bandwidth memory solutions. Toyota plans to invest JPY2 trillion in supply chain, EV, and SDV, with Tata making progress in semiconductor manufacturing.

• After the market close on 9 May, Netmarble announced that it plans to sell 2.6% stake in HYBE for 219.9 billion won. 
• The transaction is based on PRS (price return swap) basis. Previous to this deal, Netmarble sold 2.5 million shares (about 6%) of HYBE shares in November 2023. 
• We continue to remain negative on HYBE including on this deal involving Netmarble’s plan to sell additional 2.6% stake in HYBE.

• Shouhui Tech (SHOU HK) is looking to raise around US$200m in its upcoming Hong Kong IPO.
• Shouhui Tech (Shouhui) is an online life and health insurance intermediary service provider in China.
• In this note, we talk about the firm’s historical performance.

• Tower is a pure-play analog semiconductor wafer foundry that manufactures SiGe, MEMS, RF, embedded flash-based memory, analog/mixed-signal, and CMOS image-sensor devices in the US, Israel, and Japan.
• It is serving markets in mobile such as RF High Position analog, as well as in CMOS image sensors, and power management.
• It also added a new fab in Italy in partnership with STMicro that has just started shipping product and whose capacity will continue to ramp over the next two years.

• It’s an exciting 1Q24 result that revenue and GM beat the prior guidance.
• The 2Q24 outlook appears to be better than 1Q24, with revenue expected to increase by 5% to 7% QoQ and GM by 9% to 11%.
• We consider the primary bottleneck is the embargo of EUV machines to China from the Netherlands.

• XPER made further progress on product placement in the first quarter contributing to expecting revenue acceleration heading into the second half of 2024.
• XPER reported first quarter results that included the announcement of a new Japanese TV brand that would begin using TiVo in a line of its TVs
• Over the last couple of quarters XPER has announced several wins for its connected car and media platform segments. These wins have developed into revenue for XPER

• On 8 May, it was mentioned in numerous local media that Naver is under pressure from the Japanese government to sell its stake in LINE.
• One of the reasons behind Japanese government’s efforts to force Naver to sell its stake in LINE is due a major data breach incident in November 2023.
• Based on our current understanding of this situation, the most likely scenario is for Naver to sell about 20-30% stake in A Holdings (the controlling shareholder of LINE) to SoftBank.

• TSMC: Premium Fell and Then Rebounded, Now +15.6%; Can Consider Shorting Again
• ASE: Falls to +12.3%; Wait for Higher Level Before Considering a New Short Again
• ChipMOS: -0.6% Discount; Massing of Short Interest Right Ahead of Earnings

• Q124 revenues of 2.36 billion, $60 million above the guided midpoint, down 5% QoQ and down 3% YoY.
• Current quarter revenue guidance of $2.5 billion representing a ~6% QoQ increase and about the same YoY.
• Share price close to record highs yet CY2024 outlook is tepid while the massive over reliance on China just keeps on going

• ICTK reported excellent book building results. ICTK’s IPO price has been determined at 20,000 won, which is 25% higher than the high end of the IPO price range.
• ICTK is a security company specializing in Internet of Things (IoT) based on physical copy prevention technology called PUF which is a cutting-edge technology during the chip manufacturing process.
• Our base case valuation is implied market cap of 376.8 billion won or target price of 28,694 won, which is 43% higher than the IPO price (20,000 won).

• Local institutions, notably pension funds, are increasingly investing in Samsung SDS, coinciding with the company’s more active investor engagement. This has sparked speculation about Samsung’s strategic motives.
• Timing-Wise, as AI infra demands rise in Samsung Group, conditions for boosting SDS’s performance improve. They monitor Samsung’s moves to drive SDS’s stock upward, considering its reliance on Samsung’s revenue.
• Local pension funds actively adopting overweight positions in Samsung SDS underscore the importance of crafting strategies tailored to overweighting SDS within the broader Samsung Group context.

• Games Global, a promising iGaming content provider and B2B online gaming supplier, set terms for its U.S. IPO. The IPO price is expected to be between $16 and $19/share.
• With the most recent F-1/A, the company may raise ~$114M at the high end of the range at $19/share. Zinnia Limited sells additional 8.5M shares in this offering.   
• Games Global has created an impressive portfolios of iGaming content through a series of successful acquisitions, and I see upside potential vs. IPO price of $17.50 at the midpoint.

• This is a special one-time report on Bentley Systems, an infrastructure engineering software company.
• The company is currently exploring a sale and it presents a mixed but compelling case for potential acquisition.
• Several factors contribute to its attractiveness, balanced by challenges that might influence a buyer’s decision.

• In the first quarter of 2024, SPS Commerce launched a strong start to the year with a 19% increase in revenue, amounting to $149.6 million, along with a corresponding growth in recurring revenue.
• Notably, SPS Commerce capitalized on its position as a leading supplier of supply chain cloud services by intensifying investments in automation, reflecting the trend among supply chain and manufacturing leaders, 74% of whom are planning to invest in supply chain innovation and technology.
• Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

• AppFolio, a property management software provider, showcased strong financial results for Q1 2024.
• The company reported a significant 38% year-over-year increase in revenue, which calculated to $187 million for the quarter.
• This substantial growth was primarily due to increases in units and customers, along with upgrades and further adoption of value-added services.

• Lattice Semiconductor Corporation witnessed a dip in its Q1 ’24 results due to softening demand across most of its segments and end customers reducing their inventory levels.
• Sequentially, the Industrial and Automotive segment was down by 25%, while the Communications and Computing segment declined by 7%.
• Even Computing performance was affected by weaker demand in the Communications segment.

• Operating profit: FY3/24 OP was 529 billion yen (+4.9% YoY) vs analyst estimates of 537 billion (1.5% miss)
• FY3/25 Operating guidance is 400 billion yen, significantly below analyst expectations of 480 billions (-16% miss).
• The initial market reaction may be negative, we would use that as an opportunity to buy into the stock for the cyclical upturn in FY3/26.

• STAR 50 Index is a tech-focused, blue-chip index in Mainland China which tracks the top 50 largest and most liquid names in the STAR market of the Shanghai Stock Exchange.
• In my last insight (link), I discussed how the rankings had to be monitored closely before finalizing the index change expectations for the June 2024 index rebal event.
• Now that the reference period is complete, I have discussed my final expectations for the June 2024 review. The official index changes will be announced later this month.

• Taiwan Tech Rallies Along With Rebound In Global Tech; Hon Hai, Asustek Top Gainers; KYEC a Top Loser After Announcing China Market Divestment
• PC Monitor: The Next Version of MSFT CoPilot Will Be the Killer App for a Global AI PC Upgrade Cycle 
• ASMedia GDR Early Look – Momentum Has Been Strong, and Raising Would Grow Its Cash Base Almost 6x 

• Silicon Motion’s lQ24 results confirmed the company’s end-demand strength as implied by previous Samsung and SK Hynix management commentary re: solid state memory.
• Management has increased 2024E guidance, citing rising ASPs and strong demand due to its memory controller products’ usage in edge AI applications such as AI PCs and AI smartphones.
• The street upgraded target prices across the board after the results; however we note the stock remains below its past acquistion offer price by Maxlinear and we see further upside.

• Quint Digital (QUINT IN) announces alterations to its MoA, changing its name and expanding its digital ventures, including joint ventures and acquisitions.
• Quintype Technologies India Limited’s impressive growth and the acquisition of Lee Enterprises (LEE US) highlight Quint Digital’s ambitions and potential.
• Despite debt concerns, Quint Digital’s strategic investments in digital media and technology position it for substantial growth, potentially reshaping the digital publishing landscape.

• 1Q24 revenue and GM are in line, but operating income at 24.3% was 1% below consensus.
• GlobalWafers anticipates revenue in 2024 will likely be similar to 2023, which means 1H24 revenue could account for 45% of the 2024 yearly revenue.
• The planned dividend payout for 2024 is NT$19.0, with NT$8.0 from 1H23 and NT$11 from 2H23. 

• The 2Q24 revenue outlook is NT$24.4-25.5bn, which was below Bloomberg consensuses NTD$26.45bn. 
• The company sees more aggressive stocking for TVs in 2Q24, but smartphone demand is soft in 2Q24.  
• The dividend payout rate has been maintained at 80-85% over the past few years, with no significant changes expected.  

• Novatek reported 1Q24 results yesterday after the Taiwan close; gross margin came in ahead of guidance and revenue was in-line.
• Nevertheless, the company’s forward color regarding end market display applications demand in 2Q24 and 2024 was relatively muted.
• Given the stock is at all-time highs and up about 25% since early February, we see the stock at risk of selling in the near-term. We rate Novatek as Underperform.

• Gaia reported strong 1Q24 results, with revenue of $21.7 million (up 11%), 33,000 net member additions for a total membership count of 839,000 (all-time high), and strong operating cash flow of $5.9 million.
• International revenue growth was particularly strong at 20.4%, compared with respectable US growth of 3.7%.
• Member acquisition costs decreased 10%, partly as a result of a focus on direct-to-paid marketing campaigns, whereby free trial periods are replaced by special incentives to lock in longer-term membership commitments at attractive rates. This also fueled healthy deferred revenue growth of $2.0 million during the quarter.

• Pureprofile Ltd (ASX:PPL) is a data analytics and consumer insights company underpinned by proprietary technology, servicing business decision makers in brands and media companies as well as market researchers.
• Pureprofile reported a 6% increase in Q3 FY24 revenue to $10.9m and a 49% decline in Q3 EBITDA to $0.5m versus the previous corresponding period (pcp).
• Q3 is seasonally the weakest quarter for PPL and EBITDA was affected, in part, by the change in executive remuneration policy to cash-based payments.