Managing Director, Zero One, Zero One

Vincent Fernando, CFA

Managing Director, Zero One

Zero One

Founded in 2015, Zero One produces independent investment research and provides corporate finance advisory services with a focus on both listed and private technology companies. Founder Vincent Fernando has over 20 years of experience in US and Asia capital markets.

Independent Investment Research

Equity Bottom-Up

United Microelectron Sp Adr / Equity Bottom-Up

<ul>
<li>UMC Secures Key Qualcomm Advanced Packaging Order; Breakthrough in High-Growth Chip Supply Chain Segment</li>
<li>Why TSMC Remains Critical for QCOM Manufacturing, Yet UMC Provides a Strong Strategic Counterbalance</li>
<li>UMC Must Prove Itself, but QCOM Win Sparks Optimism for Sentiment and Outlook Recovery -- Maintain TSMC as Structural Long &amp; Rate UMC as Outperform</li>
</ul>


UMC Secures Key Qualcomm Advanced Packaging Order; Breakthrough in High-Growth Chip Supply Chain Segment
Why TSMC Remains Critical for QCOM Manufacturing, Yet UMC Provides a Strong Strategic Counterbalance
UMC Must Prove Itself, but QCOM Win Sparks Optimism for Sentiment and Outlook Recovery -- Maintain TSMC as Structural Long &amp; Rate UMC as Outperform


United Microelectronics: Key QCOM Advanced Packaging Win Signals Client Shift Away from TSMC

Technology / Semiconductor / Internet Research

Nicolas Baratte

<ul>
<li>Tier-2 commodity Memory is a lousy business, which requires high Capex and R&amp;D, generates very low Free Cash Flows. DRAM is more sustainable than NAND as peak margins are higher. </li>
<li>Kioxia only makes NAND, has a high market share (16%) but is a Tier-2 supplier with a roadmap lagging SK Hynix by ~2 years, and a high exposure to Consumer. </li>
<li>The Memory cycle has recovered, probably close to peak earnings. That’s why stocks have been declining (Micron, Hynix).  Part 2 will cover financials (there's a bad surprise) and valuations. </li>
</ul>


Tier-2 commodity Memory is a lousy business, which requires high Capex and R&amp;D, generates very low Free Cash Flows. DRAM is more sustainable than NAND as peak margins are higher. 
Kioxia only makes NAND, has a high market share (16%) but is a Tier-2 supplier with a roadmap lagging SK Hynix by ~2 years, and a high exposure to Consumer. 
The Memory cycle has recovered, probably close to peak earnings. That’s why stocks have been declining (Micron, Hynix).  Part 2 will cover financials (there's a bad surprise) and valuations. 


What Is Kioxia? And Should You Bother? Part 1: Why NAND Is so Hard (And Not Attractive)

Semiconductors, Memory and SSDs Specialist, Objective Analysis

Jim Handy

Semiconductors, Memory and SSDs Specialist

Objective Analysis

Objective Analysis offers third-party independent market research and data for the semiconductor industry and investors in the semiconductor industry.

Semiconductors, Memory and SSDs

Thematic (Sector/Industry)

<ul>
<li>August's WSTS semiconductor revenues registered a record high of more than $53 billion</li>
<li>Nobody seemed to notice, including the organization making the announcement</li>
<li>There's valid concern that the market is on the verge of a collapse, and this may be overshadowing record sales</li>
</ul>


August's WSTS semiconductor revenues registered a record high of more than $53 billion
Nobody seemed to notice, including the organization making the announcement
There's valid concern that the market is on the verge of a collapse, and this may be overshadowing record sales


Semis Just Broke a Record.  Why Did Nobody Notice?

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

TSMC (Taiwan Semiconductor Manufacturing) / Equity Bottom-Up

TSMC (Taiwan Semiconductor Manufacturing)

<ul>
<li>September 2024 revenues of NT$251.87 billion, an increase of 0.4% MoM and an increase of 39.6% YoY.</li>
<li>Year to date revenue through September 2024 now totals NT$2,025.85 billion, an increase of 31.9% YoY.</li>
<li>Anticipating Q4 revenue forecast of $25.7 billion, up 10% QoQ. This would mean full year 2024 revenues of $88.8 billion, a 28.3% YoY increase</li>
</ul>


September 2024 revenues of NT$251.87 billion, an increase of 0.4% MoM and an increase of 39.6% YoY.
Year to date revenue through September 2024 now totals NT$2,025.85 billion, an increase of 31.9% YoY.
Anticipating Q4 revenue forecast of $25.7 billion, up 10% QoQ. This would mean full year 2024 revenues of $88.8 billion, a 28.3% YoY increase


TSMC (Taiwan Semiconductor Manufacturing) - ADR / Equity Bottom-Up

TSMC (Taiwan Semiconductor Manufacturing) - ADR

<ul>
<li>The rally of the Asia Tech sector (+24% YTD) is highly concentrated in a handful of stocks. TSMC is up 64% but Samsung is down -22% YTD. </li>
<li>With the exception of AI, end-demand isn’t great. Smartphone up 8% but below 2019-21 level. PC flattish. x86 Server flattish. Telecom capex declining. Automotive electronics declining.   </li>
<li>AI is the most disruptive trend since Cloud in 2010. Years of increasing Capex are in front of us. But short-term, stocks are properly valued to rich, growth is slowing.</li>
</ul>


The rally of the Asia Tech sector (+24% YTD) is highly concentrated in a handful of stocks. TSMC is up 64% but Samsung is down -22% YTD. 
With the exception of AI, end-demand isn’t great. Smartphone up 8% but below 2019-21 level. PC flattish. x86 Server flattish. Telecom capex declining. Automotive electronics declining.   
AI is the most disruptive trend since Cloud in 2010. Years of increasing Capex are in front of us. But short-term, stocks are properly valued to rich, growth is slowing.


All Is Not Well in Tech Sector, AI Growth Slows, TSMC Expensive. Samsung, SK Hynix More Attractive.

South Korea

Samsung Electronics Co., Ltd. manufactures a wide range of consumer and industrial electronic equipment and products such as semiconductors, personal computers, peripherals, monitors, televisions, and home appliances including air conditioners and microwave ovens. The Company also produces Internet access network systems and telecommunications equipment including mobile phones.

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Samsung Electronics (005930 KS)

United Microelectronics: Key QCOM Advanced Packaging Win Signals Client Shift Away from TSMC

UMC secures key Qualcomm order, providing strategic counterbalance to TSMC in chip supply chain segment. Optimism likely to improve for UMC's...

Vincent Fernando, CFA

What Is Kioxia? And Should You Bother? Part 1: Why NAND Is so Hard (And Not Attractive)

Tier-2 NAND memory supplier Kioxia faces challenges with high Capex and R&D costs, low Free Cash Flows, and lagging behind technology leader SK...

Nicolas Baratte

Semis Just Broke a Record. Why Did Nobody Notice?

August's semiconductor revenues hit a record high of over $53 billion, but concerns about a potential market collapse are overshadowing the...

Jim Handy

TSMC Q324 Earnings Preview

September 24 revenues of NT$251.87 billion, +0.4% MoM & +39.6% YoY. YTD revenue NT$2,025.85 billion, +31.9% YoY. Anticipating FY2024 revenues of...

William Keating

All Is Not Well in Tech Sector, AI Growth Slows, TSMC Expensive. Samsung, SK Hynix More Attractive.

Difficult juncture for Asia Tech. Consumer and Enterprise segments are flattish; stocks have underperformed. AI is the only growth driver, growth...

Nicolas Baratte

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United Microelectronics: Key QCOM Advanced Packaging Win Signals Client Shift Away from TSMC

​UMC secures key Qualcomm order, providing strategic counterbalance to TSMC in chip supply chain segment. Optimism likely to improve for UMC's...

Vincent Fernando, CFA

What Is Kioxia? And Should You Bother? Part 1: Why NAND Is so Hard (And Not Attractive)

​Tier-2 NAND memory supplier Kioxia faces challenges with high Capex and R&D costs, low Free Cash Flows, and lagging behind technology leader SK...

Nicolas Baratte

Semis Just Broke a Record. Why Did Nobody Notice?

​August's semiconductor revenues hit a record high of over $53 billion, but concerns about a potential market collapse are overshadowing the...

Jim Handy

TSMC Q324 Earnings Preview

September 24 revenues of NT$251.87 billion, +0.4% MoM & +39.6% YoY. YTD revenue NT$2,025.85 billion, +31.9% YoY. Anticipating FY2024 revenues of...

William Keating

All Is Not Well in Tech Sector, AI Growth Slows, TSMC Expensive. Samsung, SK Hynix More Attractive.

Difficult juncture for ​Asia Tech. Consumer and Enterprise segments are flattish; stocks have underperformed. AI is the only growth driver, growth...

Nicolas Baratte

UMC secures key Qualcomm order, providing strategic counterbalance to TSMC in chip supply chain segment. Optimism likely to improve for UMC's...

Tier-2 NAND memory supplier Kioxia faces challenges with high Capex and R&D costs, low Free Cash Flows, and lagging behind technology leader SK...

August's semiconductor revenues hit a record high of over $53 billion, but concerns about a potential market collapse are overshadowing the...

Difficult juncture for Asia Tech. Consumer and Enterprise segments are flattish; stocks have underperformed. AI is the only growth driver, growth...