<Is the sound of semiconductor stocks, Cell in May?!> Factors contributing to the decline seen from TSMC & ASML earnings and AI semiconductor demand

moomooニュース米国株 wrote a column · Apr 19, 2024 17:56

TSMC and ASML dropped after earnings, SOX index also heading lower
Two companies that hold important positions in the global semiconductor industryhave recently announced their earnings. One is the world's only company manufacturing cutting-edge lithography equipment, $ASML Holding (ASML.US)$and the other is the world's largest in semiconductor foundry services (foundry). $Taiwan Semiconductor (TSM.US)$Yes.The earnings reports of both companies have been met with disapproval, affecting not only their stock prices but also the SOX index(Philadelphia Semiconductor Index ETF) as well.DeclineHowever, movements of profit-taking sales were encouraged by risk-averse movements due to the sharp rise in the yield of the US 10-year bonds.It is believed to have resulted in.

<Is the sound of semiconductor stocks, Cell in May?!> Factors contributing to the decline seen from TSMC & ASML earnings and AI semiconductor demand

This time,What exactly triggered the aversion in the earnings of both companiesI would like to examine the earnings reports of both companies along with the details. Additionally, both companiesI also confirmed the outlook for the overall semiconductor market and the demand for AI semiconductors presented at the earnings call.I decided to give it a try.

ASML
ASML's largest customer(according to Bloomberg data)TSMCand thenAccording to the report, operating profit has significantly increased, and a shift from six consecutive quarters of operating decline to growth is expected.and $Intel (INTC.US)$ isMajor customersTherefore, ASML's order situation tends to reflect orders from major semiconductor companies such as TSMC, Samsung Electronics, and Intel. As a result, new orders are particularly highlighted in ASML's earnings.

On April 17th, ASMLNew orders for the 1-3 month periodamounted to 3.6 billion euros,a 61% decrease from the previous quarterAnnounced that it has been done.. In response,4.63 billion eurosSignificantly undershotIn the market, there were high expectations for orders, especially from TSMC in cutting-edge exposure measures.

Regarding the significant decrease in ordersThe management at the earnings call、「The order flow is prone to short-term fluctuations (instability).It was explained that, when observed throughout the year, it does not necessarily become uniform.

In addition, From a long-term perspective, 、Although there is still significant uncertainty caused by the macro environment, it seems that the bottom of the (semiconductor) cycle has passed.。An industry recovery is expected in 2024.Based on conversations with customers, it is expected that 2025 will be a promising year driven by many factors.

Moreover,It is unclear whether the US export restrictions on China have influenced the order trends.The Dutch government announced a ban on the export of high-performance semiconductor manufacturing equipment to ASML in June 2023 at the request of the USA. It took effect in September of the same year and was set to expire in January 2024. There is a possibility that some Chinese companies may have increased orders in a rush.

Regarding the demand for AI semiconductors,Regarding this, the management team stated, "Similar to the previous quarter, there is momentum in demand from AI-related applications. Memory demand is being mainly driven by the node transition of DRAM technology supporting advanced memories such as DDR5 and HBM.They revealed that these memories are rapidly increasing in AI datacenters. Although SK Hynix leads the market share, Samsung Electronics in second place and the third-place entrant, who entered late, are also growing. $Micron Technology (MU.US)$ Also strengthening production.

TSMC
TSMC'sMaximumcustomerThe semiconductor manufacturing equipment related to technologies like lasers is strong, with a psychological improvement due to the recovery of NVIDIA's stock in the U.S. $Apple (AAPL.US)$(Bloomberg data). Following, $Qualcomm (QCOM.US)$、 $Advanced Micro Devices (AMD.US)$ 、 $NVIDIA (NVDA.US)$、 $Broadcom (AVGO.US)$Leading semiconductor companies, including etc, have major customers. Therefore, in the case of TSMC, it reflects trends in end-demand more closely, and the company's performance and outlook are more highly regarded than ASML.

In addition, TSMC discloses monthly sales on a monthly basis before the earnings announcement. On April 10, they announced March's sales. Based on that,Revenue for the January-March period increased by 16% compared to the same period last year.So, Marking a high growth rate not seen in about a year.As a result, market expectations were high for the earnings report to be released on April 18.

Overall, it was a good earnings report.
Announced on April 18th.Net profit for the January-March quarter increased 9% compared to the same period last year.In addition,market expectations.。Sales guidance for the April-June quarter is also 19.6 billion to 20.4 billion U.S. dollars,guidance.市場予想の19.1 billion米ドルを上振れした。会社側は、同社が業界をリードしている3ナノメートルおよび5ナノメートル技術に対する強い需要がスマートフォン向けによる影響を部分的に相殺する見込みだと説明した。

★市場が嫌気した点
・通期の設備投資計画：TSMCは通年のMaintained the capital investment plan at 28 billion to 32 billion US dollars.In the market, there are strong expectations for an upturn in semiconductor demand and the bottoming of the semiconductor cycle against the backdrop of the AI boom, so TSMC was expecting to increase its capital investment plan.

・Semiconductor market outlook for 2024The management at the earnings call slightly revised the growth outlook for this year's semiconductor market (excluding memory) from the previous 'slightly over 10%' to '10%', primarily reflecting continued weakness in sales for products such as smart phones, PCs, and automobiles.Growth outlook revision: Management at the earnings call slightly revised the growth outlook for this year's semiconductor market (excluding memory) from the previous 'slightly over 10%' to '10%', primarily reflecting continued weakness in sales for products such as smart phones, PCs, and automobiles.Growth outlook revision: Management at the earnings call slightly revised the growth outlook for this year's semiconductor market (excluding memory) from the previous 'slightly over 10%' to '10%', primarily reflecting continued weakness in sales for products such as smart phones, PCs, and automobiles.

★AI semiconductor demand
Management announced at the earnings call, "the demand for AI-related products continues to surge."TSMC is a crucial player in realizing AI applications," emphasizing that "almost all AI innovations are actively addressing the relentless demand for AI-related high-energy-efficient computing power through collaboration with TSMC."

Summary
Overall, Both ASML and TSMC's earnings callsFrom, the recovery pace of the semiconductor market for smartphones, PCs, and automobiles is slower than anticipated.On the other hand,Demand for AI semiconductors continues to be strong.has been demonstrated.

The previous rise in semiconductor stocksis, the expectation for recovery in demand other than the AI semiconductorsexpectation for recovery in demand other than the AI semiconductors (①）In addition,Strong demand outlook for AI semiconductors (②)supported by.Expectations for a US interest rate cut (③)also believed to have led to buying in growth stocks such as semiconductors.

If only ASML and TSMC's earnings are considered,the abovethere is a high possibility that ① will be delayed.it is suggested that the likelihood has increased.Currently, semiconductor stocks are easily pressured by profit-taking sales, due in part to the retreat of ③.There is also a possibility that it may resemble the situation in May for moomoo. On the other hand,What is important is that ② is still robust.Given that the AI boom is expected to be a long-lasting boom as a major technological innovation, it is believed that the growth of semiconductor companies will largely depend on ② in the medium to long term.It may be wise to take a buy-the-dip stance during adjustments. Considering the uncertainty in the movement of long-term interest rates in the USA at the moment, it seems better to diversify the timing of buy-the-dip opportunities.Created on April 19, 2024 Market Analyst Amelia

Looking ahead, it may be beneficial to take a buy-on-dips stance. Given the current uncertainty in the long-term interest rates in the USA, it seems prudent to diversify the timing of buy-on-dips opportunities.
Source: Company documents, Bloomberg and various materials compiled by moomoo Securities.

Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only. Read more

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exera : Is it dangerous to simply judge that the current stock price is impressive

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とっとこいこう : Business performance is improving, so I think semiconductors will continue to grow in the long run.

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大負けネコ(Hihi Exe) : Stock price levels have risen drastically since the end of last year due to receding statements during interest rate cuts, rising interest rates on long-term government bonds, geopolitical risks (Israel vs. Iran), etc., so securing profits for the time being would be normal behavior for investment funds or large investors.
It is normal for both ASML and TSM to come up with about one indicator that falls short of market expectations when only the fourth half of the year is cut out.
The management team probably doesn't have such an ultra-short management plan in mind. The question is how to respond to future demand at the end of this year and next year and beyond, so I felt a sense of leeway and confidence in the management team's comments.
As a weak individual investor, I'm just bullish and hold on.
Will we be able to see a slightly different movement until the presidential election in November this year? I think so.
So, even if it's salted, just watch and leave it alone.
We won't buy more, and we won't cut losses.
Iran's counterattack was at the level of a presentational pose, and both the American market and the Japanese market were too upset.
The Biden administration appears to be calmly trying to calm down.

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182791546 : Thanks for the accurate report

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新div : Next week
The financial results between Tesla and Intel
is there one?
that's scary.
Interest rates are too high
Depends on Friday's PCE.

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181338057犬心久美子 : If it's America or Japan , it's an EU V electric machine
I feel like I can master the technology and do it. One device completed with ASML is very expensive ️ how many billions ~..., so mass production is not possible and reservation order is awaited. In the Japan-US section, we agreed not to export technology because it would be stolen by China ○, but...
Did you take into account the fact that the financial results weren't good the other day?
ASML was a good day for midday
I wish I could do research and development somehow without relying on the Netherlands
I think so.

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