Tech Hardware and Semiconductor

Weekly Top Ten Tech Hardware and Semiconductor – Feb 23, 2025

By February 23, 2025 No Comments
This weekly newsletter pulls together summaries of the top ten most-read Insights across Tech Hardware and Semiconductor on Smartkarma.

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1. Taiwan Tech Weekly: TSMC & Broadcom Exploring Intel Acquisition — Implications

By Vincent Fernando, CFA, Zero One

  • TSMC & Broadcom Exploring Intel Acquisitions; Potential Major Consolidation in the Foundry Space
  • Taiwan AI Server Leader Expanding to Texas with New Production Hub
  • Semi WFE Revenues Increase ~7% YoY In 2024. 2025 Looks Much The Same. So, Where’s The AI Effect? 

2. Intel. What’s Really Going On?

By William Keating, Ingenuity

  • Carving out IFS & taking it private is the most likely outcome for Intel. However, it’s complicated by the SCIP deals and restrictions attached to the CHIPS money.  
  • Intel Products Group most likely stays with Intel, maintaining the iconic brand and doubling down on efficiency and innovation. I don’t think it gets sold. 
  • TSMC is unlikely to have any technical role in a spun out Intel Foundry due to a myriad of reasons including monopoly, conflict of interest, insufficient bandwidth etc.

3. Taiwan Dual-Listings Monitor: TSMC Premium Eases Down; Massive Change in UMC Headroom

By Vincent Fernando, CFA, Zero One

  • TSMC: +22.2% Premium; Wait for Higher Level Before Fresh Short of Spread
  • UMC: 0% Premium (Parity) — Massive Increase in ADR Headroom
  • ChipMOS: +0.5% Premium; Wait for More Extreme Levels; Earnings Ahead

4. Himax Sees Chinese Automakers Far Ahead in Adopting Touch Displays; CoPackaged Optics Key for AI/HPC

By Vincent Fernando, CFA, Zero One

  • Himax 4Q24 Results Show Auto Display Surge — Structural Growth Story Visible with Touch Panel Usage in Vehicles Soaring
  • China vs. the Rest of the World: Who’s Moving Faster? China Automakers Far Ahead in Display Sophistication
  • Himax on Co-Packaged Optics (CPO) — A Critical New Technology for AI and HPC Processing

5. Semi WFE Revenues Increase ~7% YoY In 2024. 2025 Looks Much The Same. So, Where’s The AI Effect?

By William Keating, Ingenuity

  • Q424 revenues for the top 5 WFE players amounted to $28.7 billion, up 10% QoQ and up 21.7% YoY and an all time record high quarterly revenue for the segment
  • For the full year 2024, revenues amounted to $99.74 billion, up 7% sequentially, and slightly exceeding our forecasted 5% growth.
  • WFE growth in 2025 will be similar to 2024, with slowing China spending coupled with historic over capacity across the industry countering anticipated AI & technology transition related increases 

6. TSMC (2330.TT; TSM.US): Will TSMC Work on Intel Foundry Services? There Are Three Paradoxes…

By Patrick Liao

  • It is a paradox US President wanted to make the US the number one semiconductor manufacturing country but is very likely unable to change the existing environment in the US.
  • Another paradox is that a foreign company must obtain approval from the relevant US authorities before transferring control of the specific US company, which may not be feasible.
  • It raises the third paradox that a Taiwanese company would need to operate an existing US entity with their company’s expertise under different cost conditions.  

7. Screen Holdings (7735 JP): 25%+ Upside Potential

By Scott Foster, LightStream Research

  • FY Mar-25 guidance has been raised again after strong 3Q results. Growth should continue next fiscal year with rising demand from TSMC. 
  • Sales to Chinese customers bounced back strongly last quarter, defying predictions. Capacity adds and process upgrades should continue to drive demand from China.
  • FPD, PCB and printing equipment are now profitable and should remain so. More efficient production and slower growth in depreciation should also support the operating margin.