Weekly Top Ten Tech Hardware and Semiconductor – Jul 7, 2024

1. NVIDIA’s Conundrum…

By William Keating, Ingenuity

• NVIDIA’s data center revenues tripled YoY in CY 2023 and are on track to more than double in CY 2024
• When Intel dominated the data centre and minted tens of billions annually, its customers benefited even more, minting hundreds of billions. 
• If NVIDIA’s business model succeeds, its customers will succeed even more. This will make it extremely difficult for NVIDIA to remain the #1 global market cap stock. 

2. Taiwan Tech Weekly: Apple Hikes TSMC Orders on Strong IPhone 16 Hopes; Google Shifts AI Chip to TSMC

By Vincent Fernando, CFA, Zero One

• Apple Increasing Chip Orders with TSMC — Expecting iPhone 16 Sales to be Much Stronger Than iPhone 15 Thanks to AI
• Google Said to be Shifting to TSMC from Samsung for Next Generation AI Mobile Phone Chips
• This June 28th piece appears to be timely — Memory Monitor: Micron’s Shares May Be Falling But Results’ Industry Implications Are Positive

3. PC Monitor: Growth Expectations Have Increased Recently; HPE Signals Enterprise AI Acceleration

By Vincent Fernando, CFA, Zero One

• PC & Server solutions names have fallen moderately from highs in June, however enterprise server company HPE soared 20% on AI strength.
• Despite the market pullback from highs, we note that 2025E forward growth expectations have generally increased for the universe over the last month.
• Latest Taiwan PC company revenues indicate healthy growth and HPE’s management guided for Enterprise AI orders to accelerate.

4. Fabricated Knowledge Q2 2024 Quarterly Review

By Douglas O’Laughlin, Fabricated Knowledge

• This is my quarterly piece, where I round up all of my favorite ideas (more explicitly) and explain some semiconductor jargon. This is a meta piece of content.

• First and foremost, I’ll start with performance. SMH returned 14% this quarter, among the best quarters in history for the semiconductor universe (again).
• This quarter’s leader was AOSL, who is rumored to have won a socket at Nvidia.

5. Micron Earnings, SiTime, Consumer, and Applied Materials Insider Sale

By Douglas O’Laughlin, Fabricated Knowledge

• Micron’s earnings were… acceptable.

• The market didn’t like the guide, but I think it is more of a function of expectations management.

• Micron is clearly on the upswing, and the stock needs healthy revenue and profit beats.

6. Apple Intelligence, Powered By ChatGPT. Genius Move Or Desperate Gamble?

By William Keating, Ingenuity

• Since Microsoft’s association with ChatGPT has become common knowledge, it’s share price has doubled
• Since rumours of an impending partnership with OpenAI first emerged, Apple share price is up 37% 
• The extraordinary valuations of Microsoft & Apple were driven by association with ChatGPT. Revenue growth to justify those valuations must now depend on ChatGPT. Let’s see how that works out.  

7. Silergy (6415.TT): Trial-Run with Vanguard, and Recent Stock Drops Represent an Entry Opportunity.

By Patrick Liao

• We are surprised that Silergy Corp (6415 TT) is using Vanguard Intl Semiconductor (5347 TT) to trial-run products.
• The outlook for 2024 remains unchanged at over 20% YoY, and we still see a path to recovery ahead.
• We consider the recent drop from NTD$526 on June 14th to NTD$429 on July 5th as an opportunity to consider entering the stock.