Daily Brief TMT/Internet: Advanced Micro Devices, Mediatek Inc, Cliq Digital AG and more

• The sharp rebound of Advanced Micro Devices, Inc. (NASDAQ:AMD) over the recent months came to a sudden halt after market participants were once again surprised by the deteriorating outlook for the company.
• Prompted by the bear market rally in equities, AMD’s stock has almost doubled in a matter of just a couple of months from October of last year to March 2023.
• While everyone was cheering the new wave of AI-driven demand, the quarterly report from earlier this week is a warning that should not be ignored.

• Q1’23 revenues of NT$95.7 billion, down 11.6% sequentially and 33% year-over-year.
• Q2’23 revenues sequentially flat at the midpoint. Longer replacement cycles and growing refurbishment market will see 2023 unit shipments decline a further ~10% YoY.
• Strength in Smart Edge products (TV, Tablet, Telco, Automotive) continues to offset weakness in smartphones

CLIQ Digital had a very strong start to FY23, with a 58% y-o-y revenue uplift in Q123 (to €83m) and an EBITDA margin of 15.4% (Q122: 15.8%). Raised levels of marketing spend continue to drive momentum, generating growth in both the lifetime value of the customer base (LTVCB) and in the number of paid members. CLIQ is inherently highly cash generative and net cash was €10.9m at the quarter-end. Management has reiterated both FY23 and mid-term 2025 sales guidance, and our forecasts are unchanged, underpinned by the strong Q123 performance. CLIQ’s valuation remains at a significant discount to peers on EV/sales and EV/EBITDA multiples, with substantial potential upside to the current share price on current estimates, in our view.