[Earnings preview] Tokyo Electron expects strong investment from China to continue
● $Tokyo Electron (8035.JP)$ Consideration has begun for a collaboration with moomoo.3:30 PM on May 10thwill announce the consolidated financial statements for the fiscal year ending March 2024.
●Company EstimatesSo,Consolidated Revenuecompared to the previous yeara decrease of 17.2% to 1.83 trillion yen、Net profitisA decrease of 27.9% to 340 billion yen.is expected.
●Bloomberg market forecastSo,Consolidated revenuecompared to the previous year1.833 trillion yen, down 17%、Earnings per share (EPS)isDecreased by 26.9%of736.843 yen.
Semiconductor manufacturers have been adjusting inventory due to the slowdown in demand for PCs and smart phones, but Tokyo Electron noted in the 3Q period of the fiscal year ending March 2024, that improvement in the supply-demand balance of semiconductorshas been observed, and there are indications of bottoming out in equipment investment. There has been an increase in inquiries for equipment for AI applications, andthere has been an increase in investments from Chinese customers.is doing.
●アナリスト19人による評価では、52.6％が強気、26.32％がやや強気、21.05％が中立で、総合評価は「やや強気」is turning out to be.平均目標株価は38843.35円で、5月7日終値からは5.4％の上昇余地がある。レンジは24000～48200円。(As of May 7)●Bloomberg market forecastSo,Consolidated revenuecompared to the previous year1.833 trillion yen, down 17%、Earnings per share (EPS)isDecreased by 26.9%of736.843 yen.
Semiconductor manufacturers have been adjusting inventory due to the slowdown in demand for PCs and smart phones, but Tokyo Electron noted in the 3Q period of the fiscal year ending March 2024, that improvement in the supply-demand balance of semiconductorshas been observed, and there are indications of bottoming out in equipment investment. There has been an increase in inquiries for equipment for AI applications, andthere has been an increase in investments from Chinese customers.is doing.
![[Earnings preview] Tokyo Electron expects strong investment from China to continue](https://sgsnsimg.moomoo.com/sns_client_feed/181569713/20240507/0d341afba550b9ba1f72a54f1eefacca.png/big?area=105&is_public=true)
●Upward revision of full-year forecast due to strong performance in China, aiming for a reduction in profit decline.
The consolidated earnings report for the third quarter (3Q) announced on February 9 this year showed a significant decrease in revenue and profit compared to the same period last year, due to the impact of reduced investment from semiconductor manufacturers affected by the sluggish market conditions.However, despite the significant decline in revenue and profit, the full-year revenue, operating profit, ordinary profit, and net profit estimates were all upwardly revised concurrently with the 3Q announcement, leading to a reduction in revenue and profit decline.The reduction in revenue and profit decline has been minimized by the upward revisions in the full-year revenue, operating profit, ordinary profit, and net profit forecasts made at the time of the 3Q announcement.There are signs of a bottoming out in the market conditions.It is reported that there is an increasing demand for equipment for advanced packaging for AI applications.In addition, efforts to improve the self-sufficiency rate of semiconductors in China, which is a major sales destination, are active.Efforts to improve the self-sufficiency rate of semiconductors in China are vigorous.Investments in IoT, automotive, and industrial equipment are progressing well in China, with expectations of continued investment growth.39.3％The ratio of China's revenue in the first quarter was , and in the third quarter of the fiscal year46.9％Rising, with increasing emphasis on Chinese demand.
The consolidated earnings report for the third quarter (3Q) announced on February 9 this year showed a significant decrease in revenue and profit compared to the same period last year, due to the impact of reduced investment from semiconductor manufacturers affected by the sluggish market conditions.However, despite the significant decline in revenue and profit, the full-year revenue, operating profit, ordinary profit, and net profit estimates were all upwardly revised concurrently with the 3Q announcement, leading to a reduction in revenue and profit decline.The reduction in revenue and profit decline has been minimized by the upward revisions in the full-year revenue, operating profit, ordinary profit, and net profit forecasts made at the time of the 3Q announcement.There are signs of a bottoming out in the market conditions.It is reported that there is an increasing demand for equipment for advanced packaging for AI applications.In addition, efforts to improve the self-sufficiency rate of semiconductors in China, which is a major sales destination, are active.Efforts to improve the self-sufficiency rate of semiconductors in China are vigorous.Investments in IoT, automotive, and industrial equipment are progressing well in China, with expectations of continued investment growth.39.3％The ratio of China's revenue in the first quarter was , and in the third quarter of the fiscal year46.9％Rising, with increasing emphasis on Chinese demand.
●Expecting double-digit growth in 2025 (calendar year).
The company expects continued investment from Chinese customers in 2024 (calendar year), and anticipates the recovery of investment in cutting-edge DRAM for the second half of the year. In 2025 (calendar year)the growth of AI servers continues.and with the activation of corporate IT investments and the replacement of products purchased during the corona period, the demand for PCs and smart phones is expected to recover.PC and smart phone demand is expected to recover.will.Expecting double-digit growth.According to Bloomberg data, major sales channels include $Intel (INTC.US)$、 $Taiwan Semiconductor (TSM.US)$, Samsung, $Micron Technology (MU.US)$, SK Hynix, $Texas Instruments (TXN.US)$etc. Looking at the recent earnings reports of customer companies, Intel's performance in datacenter semiconductor was lackluster, but the outlook for other customer companies like Samsung, Micron Technology, among others, is bright, increasing expectations amidst rising investment enthusiasm.
The company expects continued investment from Chinese customers in 2024 (calendar year), and anticipates the recovery of investment in cutting-edge DRAM for the second half of the year. In 2025 (calendar year)the growth of AI servers continues.and with the activation of corporate IT investments and the replacement of products purchased during the corona period, the demand for PCs and smart phones is expected to recover.PC and smart phone demand is expected to recover.will.Expecting double-digit growth.According to Bloomberg data, major sales channels include $Intel (INTC.US)$、 $Taiwan Semiconductor (TSM.US)$, Samsung, $Micron Technology (MU.US)$, SK Hynix, $Texas Instruments (TXN.US)$etc. Looking at the recent earnings reports of customer companies, Intel's performance in datacenter semiconductor was lackluster, but the outlook for other customer companies like Samsung, Micron Technology, among others, is bright, increasing expectations amidst rising investment enthusiasm.
●Although dividend forecasts show a significant decrease from the previous period, the total return amount remains at its highest due to share buybacks.
The dividend estimate for the fiscal year ending in March 2024 is expected to be 367 yen, a decrease of 37% compared to last year's 570 yen due to the repurchase of treasury stock,resulting in the highest total return in history.The consolidated dividend payout ratio is50%as stated in the company's 3Q earnings presentation material for the fiscal year ending in March 2024 (see graph below):
The dividend estimate for the fiscal year ending in March 2024 is expected to be 367 yen, a decrease of 37% compared to last year's 570 yen due to the repurchase of treasury stock,resulting in the highest total return in history.The consolidated dividend payout ratio is50%as stated in the company's 3Q earnings presentation material for the fiscal year ending in March 2024 (see graph below):
![[Earnings preview] Tokyo Electron expects strong investment from China to continue](https://sgsnsimg.moomoo.com/sns_client_feed/181569713/20240507/0ed16af0b93f90e589eb9f5a741b7638.png/big?area=105&is_public=true)
●Expecting a positive long-term outlook, the company is planning a significant amount of research and development expenses.
The company expects the semiconductor market size to grow by 74% from 574 billion dollars in 2022 to 1 trillion dollars in 2030. In line with this, as part of investments for the future, between the fiscal years ending in March 2025 and March 2029,Research and development expenses of 1.5 trillion yen.、Capital investment of 700 billion yen.、Plan to hire 10,000 employees (2,000 annually).Planned after 2025, a film forming equipment production facility in Oshu City, Iwate Prefecture, a Coater/Developer in Koshi City, Kumamoto Prefecture, a new development building for cleaning equipment, and a new development building for etching equipment in Kurokawa District, Miyagi Prefecture.
●Major ratings of Tokyo Electron by securities companies.
![[Earnings preview] Tokyo Electron expects strong investment from China to continue](https://sgsnsimg.moomoo.com/sns_client_feed/181569713/20240507/1d58dd8bf9ecdeb272e3d1c79ed95f50.jpg/big?area=105&is_public=true)
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Sources: Bloomberg, Nikkei, Tokyo Electron hp inc Materials, moomoo
Sources: Bloomberg, Nikkei, Tokyo Electron hp inc Materials, moomoo
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