Technology / Semiconductor / Internet Research

Nicolas Baratte

Nicolas Baratte has been a financial analyst since 2000, covering the Semiconductor sector and Global Technology. Nicolas has worked on the sell-side for JPMorgan, CLSA. On the buy-side for a Tiger fund and Prudential. Nicolas has covered semiconductors, Asian hardware and components, and the Global Tech supply chain. Nicolas lives mostly in Taiwan, sometimes in France and is in New York regularly.

Equity Bottom-Up

<ul>
<li>Good 3Q25: revenue 4% above Consensus, Operating Income 7% above. But a huge US$18bn tax reversal leads to a big GAAP miss. A 10% NON-GAAP beat.</li>
<li>2025 Capex revised up to high end of range, from $66-72 bn to $70-72 billion. 2026 Capex dollar growth will be notably larger than 2025, that means over 100bn.</li>
<li>Stock down -9% after hours, an over-reaction to a one-off non-cash tax write off. Valuations: slightly high as 2026 growth is forecast to be low due to OP margin decline.</li>
</ul>


Good 3Q25: revenue 4% above Consensus, Operating Income 7% above. But a huge US$18bn tax reversal leads to a big GAAP miss. A 10% NON-GAAP beat.
2025 Capex revised up to high end of range, from $66-72 bn to $70-72 billion. 2026 Capex dollar growth will be notably larger than 2025, that means over 100bn.
Stock down -9% after hours, an over-reaction to a one-off non-cash tax write off. Valuations: slightly high as 2026 growth is forecast to be low due to OP margin decline.


Meta: A Good 3Q Spoiled by a Tax Problem. Capex Boom Continues in 2026.