Tech Hardware and Semiconductor

Weekly Top Ten Tech Hardware and Semiconductor – Jan 26, 2025

By January 26, 2025 No Comments
This weekly newsletter pulls together summaries of the top ten most-read Insights across Tech Hardware and Semiconductor on Smartkarma.

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1. UMC. Now I’m Interested…

By William Keating, Ingenuity

  • UMC reported Q424 revenues of NT$60,386 million, flat sequentially and in line with guidance.
  • For the full year 2024, revenues amounted to NT$232,303 million, representing an increase of 4.4% YoY.
  • Share price at a 4 year low and the outlook is still tepid, but almost $6 billion CapEx invested during the downturn years will pay dividends in the coming years..

2. Taiwan Dual-Listings Monitor: TSMC Spread Down But Still Extreme; UMC Rare ADR Discount Level

By Vincent Fernando, CFA, Zero One

  • TSMC: +23.9% Premium; Fallen But Remains in Historically Extreme Territory
  • UMC: -3.6% Discount; Good Level to Go Long the ADR Spread
  • ASE: +0.3% Premium; Can Consider Going Long the Spread at Current Level

3. UMC (2303.TT; UMC.US): Earthquake Alters 1Q25 Outlook; 2025 Growth Expected to Low Single Digits YoY

By Patrick Liao

  • Shipment: expected to decrease by mid-single-digits QoQ ASP: Remains flat in USD/NTD appreciation may lead to decline for 1Q25 sales. 
  • UMC’s addressable market in 2025 will grow in the low-single-digits YoY, driven by a moderate recovery in consumer applications in mature nodes.  
  • 1Q25 consumer will grow QoQ thanks to higher DTV, DDI, Wi-Fi, and STB demand. Other applications will decline QoQ.

4. Taiwan Tech Weekly: UMC Results Ahead; Nvidia & TSMC Partner for Silicon Photonics Technology

By Vincent Fernando, CFA, Zero One

  • UMC Results This Week; Insight Into Supply/Demand Environment for More Mature Semiconductor Segments
  • Nvidia and TSMC Announce Partnership in Silicon Photonics Technology — Will Enable More Energy-Efficient AI
  • TSMC 4Q24 Results Signal Multi-Year Market Share Gains; Margin Strength; Sustainable Industry Growth 

5. Silicon Motion: Memory Controllers Emerging as Strategic Pillar for Global HPC and AI Leadership

By Vincent Fernando, CFA, Zero One

  • What is PCIe 5.0 and Why SIMO is Poised to Expand Market Share with PCIe 5.0
  • PCIe 5.0 and Beyond — Importance for Enterprise HPC and AI Data Centers
  • Looking Ahead: MaxLinear Arbitration in 2H25E — We Believe SIMO Likely to Win Its Termination Fee Plus Additional Award for Additional Damages

6. Stargate. It’s Not All About You Microsoft. Or You Either Elon

By William Keating, Ingenuity

  • President Donald Trump announced the Stargate Project, a new company which intends to invest $500 billion over four years building new AI infrastructure for OpenAI in the United States.
  • Elon Musk is miffed, Microsoft says they “approved” the project and have a new Right of First Refusal agreement in place with OpenAI. 
  • Stargate is exclusively for OpenAI and the press release states that its mission is to provide a strategic capability to protect the national security of America and its allies.

7. United Microelectronics 4Q24 Results: Intel Partnership On Track and Is A Key Model for UMC’s Future

By Vincent Fernando, CFA, Zero One

  • UMC Misses 4Q24 Expectations — Gross Margin Dips with Flat QoQ Revenue
  • UMC Guides for 40% Reduction in Capex Budget — We Believe Signals Strategic Shift to Less Capex Intensive Business Model
  • Intel 12nm Partnership Remains on Track and is Key Business Model for Future; UMC Sees Improvement in Consumer Electronics Industry Inventories

8. TSMC (2330.TT; TSM.US): Earthquake Impact Limited; Setting Newest Production Line Not Viable in US.

By Patrick Liao

  • Taiwan experienced an earthquake on January 21st, and the tremors are still ongoing.
  • Dr. CC Wei, Chairman of TSMC, explained the establishment of over 10,000 additional Standard Operating Procedures (SOPs) at the U.S. Fab.  
  • The yield at TSMC’s Arizona fab is about 4% higher than at their Tainan fab, marking a record for initial production.   

9. Novatek (3034.TT): Rush Orders Received and Beneficial from Chinese Household Electronic Demand.

By Patrick Liao

  • Novatek Microelectronics Corp (3034 TT) 1Q25 demand has surged abruptly, with a likely 5% quarter-over-quarter shipment increase.  
  • China’s substantial demand is capable of supporting a Fabless leader like Novatek.  
  • The unexpected demand surge in 1Q25 has greatly benefited Novatek .  

10. Vanguard (5347.TT): 1Q25 Outlook Could See a Flat QoQ; Shipments for DDIC and PMIC Are Increasing.

By Patrick Liao

  • Usually, the 1st quarter of each year should show a decline for foundry companies, but Vanguard Intl Semiconductor (5347 TT)‘s 1Q25 results could be relatively flat quarter-over-quarter.  
  • Vanguard Intl Semiconductor (5347 TT)‘s demand for Display Driver IC (DDIC) is on the rise, surpassing the growth seen in Power Management IC (PMIC).
  • Despite the potential increase in shipments in 1Q25, the rise in lower-margin products, such as 8″ DDICs for large panels, is notable.