[Is the AI boom still going on?] Turbulent semiconductor stock financial results and stock prices, & NVIDIA

$Micron Technology(MU.US)$The financial results period is February, and the financial results are announced in March, so to be precise, they are not applicable to the current financial results season, which began in April, but since the financial results announced at the end of March also include results for January-February this year, I have decided to post them together. Micron Technology's stock price rose 14% on the next trading day after announcing results that significantly exceeded market expectations.

After that, a major semiconductor manufacturing equipment company $ASML Holding(ASML.US)$ It is a former semiconductor giant $Intel(INTC.US)$ , and $Advanced Micro Devices(AMD.US)$announced financial results for the fiscal year ending January-March, which exceeded market expectations, but stock prices fell 7-9% on the next trading day. Both were disgusted by the expected decline in guidance. In the case of ASML and AMD, the predicted PER (price-earnings ratio) exceeded 35 times, and it seems that the sense of high value compared to performance was also a selling factor.

Stock prices continued to rise due to the AI boom $Super Micro Computer(SMCI.US)$Both results and guidance surpassed market expectations, and the predicted PER was about 23 times higher, but the stock price fell 14% on the next trading day. In the case of SMCI, unlike other stocks, it seems that a sharp rise in stock prices until before financial results are announced is the cause of profit-making sales. Looking at stock price returns over the past year, SMCI is abnormally high at 602%. Since the stock price had increased 7 times by incorporating good financial results, it is thought that “factual sales” became dominant.

$Texas Instruments(TXN.US)$ with $Qualcomm(QCOM.US)$Stock prices rose after announcing financial results that exceeded market expectations (Qualcomm traded overtime after financial results were announced). There is also a slight sense of delay in stock price returns for both stocks over the past year, and this seems to be a factor in which stock prices responded honestly to good performance.

As mentioned in the 4/23 report, it is representative of the SOX index and AI boom in the phase where US 10-year bond yields rose rapidly from mid-July to the end of October 2023 $NVIDIA(NVDA.US)$Major adjustments have been made. For your reference, I will republish the graph shown at the time.

$ASML Holding(ASML.US)$
Target share price change rate (*1): +4.8%
Deviation rate from target stock price (*2): 26.8%
(*1: From when financial results are announced until 5/2; *2: Compared to closing price on 5/1, same as below)

●New orders for the January-March fiscal year were 3.6 billion euros, a 61% decrease from the previous quarter. It was significantly lower than the market forecast of 4.63 billion euros. The management team explained that “the order flow tends to be uneven (in the short term) (unstable), and when viewed throughout the year, it is not necessarily uniform.”
●“In the long run, although major uncertainties due to the macro environment still exist, the bottom of the (semiconductor) cycle seems to have passed. We expect the industry to recover during 2024.”
●“Similar to the previous quarter, there is momentum in demand from AI-related applications. Memory demand is mainly driven by node migration of DRAM technology that supports advanced memories such as DDR5 and HBM.”

●Sales guidance for the April-6 fiscal year was 19.6 billion to 20.4 billion US dollars, which was higher than the market forecast of 19.1 billion US dollars. The company explained that strong demand for 3 nanometer and 5 nanometer technology, which the company is leading the industry, is expected to partially offset the impact on smartphones.
●The full-year capital investment plan remained unchanged at 28 billion to 32 billion US dollars. The growth forecast for the semiconductor market (excluding memory) this year was slightly revised downward from the previous “just over 10%” to “10%.” It mainly reflects the fact that sales for smartphones, computers, automobiles, etc. are still weak.
●The management stated that “demand related to AI continues to increase rapidly.”

●Sales guidance for the April-6 fiscal year was 5.1 billion to 5.5 billion, which exceeded market expectations of 4.73 billion dollars. Excluding some items, the earnings per share (EPS) forecast was 8.42 dollars, which was higher than the market forecast of 6.97 dollars.
●The management team raised sales guidance for the fiscal year ending 2024/6 from the previous 14.7 billion dollars to 15.1 billion dollars, while pointing out that there is a shortage of supply of the company's latest liquid cooling systems, where demand is growing. Strong demand for AI servers and the company's innovative liquid cooling design are driving growth, he said. It was stated that strong growth could be maintained in the 2025/6 fiscal year.
●“The popularity of AI platforms is high, and competition is intensifying, but SMCI has a short time until market launch, and market share can be expanded.”

●The 2Q sales guidance was generally in line with market expectations, and there were no surprises. The full-year GPU (image processing equipment) sales forecast for the data center division was revised upward from the previous 3.5 billion dollars to 4 billion dollars, reflecting an increase in shipments of the AI semiconductor “MI300.” However, it fell short of the market forecast of about 6 billion dollars.
●The management revealed that the MI300 series products became the fastest growing product in AMD history, and total sales exceeded 1 billion dollars in less than 2 quarters. “The introduction of MI300X (counterpart product to NVIDIA's AI semiconductor “H100”) is expanding in the Microsoft, Meta, and Oracle clouds.”
●“The introduction of the MI300 is progressing smoothly. Even for the quarter that just ended (1Q), results were slightly better than expected at the beginning of the quarter. It is expected that 2Q will also be a major launch. We plan to increase supply quarterly this year.”

●Sales guidance for the April-6 fiscal year was 8.8 billion dollars to 9.6 billion dollars, which exceeded market expectations of 9.08 billion dollars. The adjusted EPS guidance was between $2.15 and $2.35, which was higher than the market forecast of $2.16.
●The management said, “We are excited about QCT Automotive's top earnings for 3 consecutive quarters, the launch of the Snapdragon X platform, and the realization of growth and diversification, including the realization of advanced on-device AI functions in multiple product categories.”
●“As AI rapidly expands from cloud to device, our company, which has demonstrated leadership at the edge in technology in general, including on-device AI, is in a very advantageous position to take advantage of this growth opportunity.”

★ Tech giants to further expand capital investment for AI infrastructure
In the current AI boom, why is there huge expenditure on investment for AI $Meta Platforms(META.US)$ Ya $Microsoft(MSFT.US)$ 、 $Alphabet-A(GOOGL.US)$ It is a major US tech company represented by It is, so to speak, a “superior customer” for semiconductor companies.

Financial results for major tech companies have also been completed, and each company has indicated that they will increase capital investment for AI. $Tesla(TSLA.US)$They have also introduced 35,000 “H100” units, but it was indicated that it is expected to reach 85,000 units by the end of this year.

The reason why each company continues to strengthen infrastructure for AI is that it can be expected to contribute to business results. For example, in the current financial results, Microsoft and Alphabet, $Amazon(AMZN.US)$In both cases, the cloud business was doing better than expected. In both cases, investment in AI led to an increase in business performance.

Looking at it comprehensively,Financial results from major semiconductor companies and tech giants indicate that the boom in capital investment for AI continues, and the introduction of AI is also expanding. It may be necessary to be wary of a sharp rise in interest rates, but based on the strength of the US economy and the abundant financial power of major tech companies, it is difficult to assume that the AI investment boom will suddenly decline. If the AI investment boom continues, it is expected that the performance of companies led by NVIDIA will continue to expand, which will support the AI boom.

Note that you can check the financial results summaries of major tech companies by MOOMOO SECURITIES below. I hope you can also refer to it.
[Financial Summary] Tesla to introduce models cheaper than the biggest decline in sales in the past 12 years by early 25
[Financial Summary] Meta falls sharply by 13%, sales and profit increases are also sluggish
[Financial Summary] Google increases sales and profit for the January-March fiscal year, and the cloud business is doing well
[Financial Results Summary] Microsoft's sales and profit are up ahead of expectations, and the cloud Azure is also doing well
[Financial Summary] Amazon does not announce cloud growth acceleration dividend payments
[Financial Summary] AMD: Full-year AI semiconductor sales forecast did not meet expectations, sense of disappointment