Semiconductor & Technology Specialist, Ingenuity

William Keating

Semiconductor & Technology Specialist

Ingenuity

Our focus is exclusively on in-depth research & consulting in the broader semiconductor industry. We focus on the key players, namely Intel, Micron, Qualcomm, Apple, Samsung, NVIDIA, AMD, TSMC & Global Foundries - as well as some of the lesser known, but nonetheless critical, companies such as ASML (for EUV), Mellanox, Cavium, Xilinx etc. We specialise in their products, roadmaps, process technologies, competitive advantages & threats etc. We also help our clients understand the implications of new and emerging technologies, e.g. 3D X-Point, 3D NAND, Carbon Nanotubes, Autonomous Driving, Graphene, Silicon Photonics, Wafer-Level Optics, Artificial Intelligence, FPGA, GPU, ASIC etc. 

Semiconductor Analysis & Research

Equity Bottom-Up

<ul>
<li>
Model Convergence: capabilities that once required specialized models are increasingly handled by the main Gemini LLMs, which can now be state of the art for math and other scientific questions</li>
<li>Brin admitted he is “always kind of confused as to how to prompt the models” and even the Gemini team does not know exactly where the models’ capability edges are!</li>
<li>He cited chain-of-thought (”think step by step”) as an example of a technique that seemed trivial or “the dumbest thing ever” yet drove a significant jump in AI capability.</li>
</ul>



Model Convergence: capabilities that once required specialized models are increasingly handled by the main Gemini LLMs, which can now be state of the art for math and other scientific questions
Brin admitted he is “always kind of confused as to how to prompt the models” and even the Gemini team does not know exactly where the models’ capability edges are!
He cited chain-of-thought (”think step by step”) as an example of a technique that seemed trivial or “the dumbest thing ever” yet drove a significant jump in AI capability.


Sergey Brin On Model Convergence, Prompt Engineering & Transformer Evolution

Technology / Semiconductor / Internet Research

Nicolas Baratte

<ul>
<li>AI Capex is reaching operating cash flows, Hyperscalers won’t gear up and resort to equity issuance to finance Capex . At the same time, concerns are growing over token cost.</li>
<li>2 circular parameters – chicken and egg. More Capex is needed to increase scale, buy more efficient chips; so that token cost declines faster. Spend more to save more.</li>
<li>Your choice. 1) Cloud growth and margins are increasing. it’s a timing mismatch, Capex first, big profits later. 2) AI capacity can’t generate enough cash flow to finance itself. </li>
</ul>


AI Capex is reaching operating cash flows, Hyperscalers won’t gear up and resort to equity issuance to finance Capex . At the same time, concerns are growing over token cost.
2 circular parameters – chicken and egg. More Capex is needed to increase scale, buy more efficient chips; so that token cost declines faster. Spend more to save more.
Your choice. 1) Cloud growth and margins are increasing. it’s a timing mismatch, Capex first, big profits later. 2) AI capacity can’t generate enough cash flow to finance itself. 


Google Is Running Out of Money! Just Kidding! AI Capex Financing Versus Token Cost Decline.

Hedge Fund News, Information and Data, Hedge Fund Alpha

Hedge Fund Alpha

Hedge Fund News, Information and Data

We focus on hedge funds with a bias towards emerging managers, specifically fundamental long-short managers. We are known for a lot of insights and exclusives on hedge fund letters, coverage of industry conferences, and interviews with investors and interesting service providers.

Thematic (Sector/Industry)

<ul><li>Hedge funds kept artificial intelligence at the center of their portfolios in August, but the question changed.</li><li>Instead of asking whether AI can generate revenue, managers increasingly focused on who will finance the infrastructure buildout and whether the cash flows will cover the debt behind it.</li><li>That shift showed up in the breadth of ownership.</li></ul>

Hedge funds kept artificial intelligence at the center of their portfolios in August, but the question changed.Instead of asking whether AI can generate revenue, managers increasingly focused on who will finance the infrastructure buildout and whether the cash flows will cover the debt behind it.That shift showed up in the breadth of ownership.

Hedge Funds Cut Magnificent Seven Longs As AI Debt Risks Come Into Focus

<ul>
<li>Alphabet aka Google: some room for Consensus to increase, Cloud growth * margins expansion are accelerating. Valuations are reasonable at 27x next year EPS for 18% EBIT Cagr over ’25-28.</li>
<li>Amazon: highest growth at 27% EBIT Cagr over ’25-28, same valuations as GOOG: 27x next year. Relative to GOOG, you probably apply a valuation discount to eCommerce</li>
<li>Microsoft is probably the best “value” stock: 21x next year earnings, 18% EBIT CAGR but we need to see Cloud margins improving. The latest Capex guidance puts that into doubts </li>
</ul>


Alphabet aka Google: some room for Consensus to increase, Cloud growth * margins expansion are accelerating. Valuations are reasonable at 27x next year EPS for 18% EBIT Cagr over ’25-28.
Amazon: highest growth at 27% EBIT Cagr over ’25-28, same valuations as GOOG: 27x next year. Relative to GOOG, you probably apply a valuation discount to eCommerce
Microsoft is probably the best “value” stock: 21x next year earnings, 18% EBIT CAGR but we need to see Cloud margins improving. The latest Capex guidance puts that into doubts 


Hyperscalers: Consensus Revisions and Valuations Post Earnings. Best Growth Stocks: GOOG and AMZN

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

<ul><li>Alphabet announced 1Q26 results: total revenue was up by 22% YoY to US$109.9bn, 3% ahead of Bloomberg consensus due to the robust growth of revenue from Cloud and Search.</li><li>During the period, operating income grew by 30% YoY to US$39.7bn despite the step-up of AI investment, 10% ahead of the consensus thanks to the strong operating leverage and efficiency improvement.</li><li>AI continues to drive solid growth of core search and cloud businesses, and the company plans to further increase AI investment given the attractive ROIC. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Alphabet announced 1Q26 results: total revenue was up by 22% YoY to US$109.9bn, 3% ahead of Bloomberg consensus due to the robust growth of revenue from Cloud and Search.During the period, operating income grew by 30% YoY to US$39.7bn despite the step-up of AI investment, 10% ahead of the consensus thanks to the strong operating leverage and efficiency improvement.AI continues to drive solid growth of core search and cloud businesses, and the company plans to further increase AI investment given the attractive ROIC. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Alphabet (GOOG US) - 1Q26 Results Beat on Strong Search and Cloud Businesses; AI as the Key Driver

United States

Alphabet, Inc. operates as a holding company. The Company, through its subsidiaries, provides web-based search, advertisements, maps, software applications, mobile operating systems, consumer content, enterprise solutions, commerce, and hardware products.

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Alphabet (GOOG US)

Sergey Brin On Model Convergence, Prompt Engineering & Transformer Evolution

Model Convergence: capabilities that once required specialized models are increasingly handled by the main Gemini LLMs, which can now be state of...

William Keating

Google Is Running Out of Money! Just Kidding! AI Capex Financing Versus Token Cost Decline.

AI companies are facing a dilemma as they need to increase Capex to lower token costs, but struggle to finance it with operating cash flows....

Nicolas Baratte

Hedge Funds Cut Magnificent Seven Longs As AI Debt Risks Come Into Focus

Hedge funds kept artificial intelligence at the center of their portfolios in August, but the question changed. Instead of asking whether AI can...

Hedge Fund Alpha

Hyperscalers: Consensus Revisions and Valuations Post Earnings. Best Growth Stocks: GOOG and AMZN

Alphabet and Amazon have reasonable valuations with strong growth potential, while Microsoft is seen as the best "value" stock but faces...

Nicolas Baratte

Alphabet (GOOG US) - 1Q26 Results Beat on Strong Search and Cloud Businesses; AI as the Key Driver

Alphabet announced 1Q26 results: total revenue was up by 22% YoY to US$109.9bn, 3% ahead of Bloomberg consensus due to the robust growth of revenue...

CMB International

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52-week Range

Market Cap (USDm)

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Sergey Brin On Model Convergence, Prompt Engineering & Transformer Evolution

Model Convergence: capabilities that once required specialized models are increasingly handled by the main Gemini LLMs, which can now be state of...

William Keating

Google Is Running Out of Money! Just Kidding! AI Capex Financing Versus Token Cost Decline.

​AI companies are facing a dilemma as they need to increase Capex to lower token costs, but struggle to finance it with operating cash flows....

Nicolas Baratte

Hedge Funds Cut Magnificent Seven Longs As AI Debt Risks Come Into Focus

Hedge funds kept artificial intelligence at the center of their portfolios in August, but the question changed. Instead of asking whether AI can...

Hedge Fund Alpha

Hyperscalers: Consensus Revisions and Valuations Post Earnings. Best Growth Stocks: GOOG and AMZN

​Alphabet and Amazon have reasonable valuations with strong growth potential, while Microsoft is seen as the best "value" stock but faces...

Nicolas Baratte

Alphabet (GOOG US) - 1Q26 Results Beat on Strong Search and Cloud Businesses; AI as the Key Driver

Alphabet announced 1Q26 results: total revenue was up by 22% YoY to US$109.9bn, 3% ahead of Bloomberg consensus due to the robust growth of revenue...

CMB International

AI companies are facing a dilemma as they need to increase Capex to lower token costs, but struggle to finance it with operating cash flows....

Alphabet and Amazon have reasonable valuations with strong growth potential, while Microsoft is seen as the best "value" stock but faces...