Bible 2Q21: Leading Edge Semis & Semicap Equipment - Upward revisions again… getting us closer to the peak
We publish today the last section of our 2Q21 Bible, on the leading edge semi and semicap equipment market. In line with our thesis, structural growth drivers 5G and HPC will continue to drive demand in 2021 and beyond. In Memory, bit demand growth is still accelerating, but could suffer from a pullback in PC and in smartphones in the next 18 months, while hyperscale should remain strong for some time. Manufacturers are increasing capex, while DRAM spot prices came under pressure in August, triggering concerns about supply growing faster than demand. In semicap, 2021 is set to be a record year and we see room for a $100bn WFE peak in the next 5 years, but also room for a cyclical correction on that time horizon. How 2022 shapes up is anyone’s guess at this stage: We see a combination of near-term cyclical risks (iPhone, PCs, gaming, crypto) and continued secular drivers (HPC / Cloud, Enterprise IT recovery, Autos & Industrials). We know the peak is not far, we don’t know when it will form and how steep the pull back will be on the back of it.Applied Materials provides manufacturing equipment, services and software to the semiconductor, display and related industries. The company's segments are: Semiconductor Systems, which develops, manufactures and sells a range of manufacturing equipment used to fabricate semiconductor chips; Applied Global Services, which provides integrated solutions to support equipment and fab performance and productivity; and Display and Adjacent Markets, which is comprised of products for manufacturing liquid crystal displays, organic light-emitting diodes and other display technologies for TVs, monitors, laptops, personal computers, electronic tablets, smart phones, and other consumer-oriented devices.
ASML Holding provides lithography systems for the semiconductor industry, manufacturing machines that are used in the production of integrated circuits or chips. Co. develops, produces, markets, sells and services advanced semiconductor equipment systems exclusively consisting of lithography systems. Co. sells its products to micro-processor manufacturers and Foundries, NAND-Flash memory and DRAM memory chipmakers. Co.'s products line includes the following: PAS 5000 lithography systems, which Co. no longer manufactures but continues to refurbish; PAS 5500 products; TWINSCAN DUV systems and TWINSCAN EUV systems based on a new platform utilizing the concepts of the TWINSCAN platform.
Intel is a data-centric company. The company's operating segments are: Data Center Group, which develops platforms for compute, storage, and network functions; Internet of Things Group, which facilitates its customers creating, storing, and processing data; Mobileye, which provides assistance and automation solutions; Non-Volatile Memory Solutions Group, which provides memory and storage products based on Intel? Optane? technology and Intel? 3D NAND technology; Programmable Solutions Group, which provides programmable semiconductors; and Client Computing Group, which connects people to data, allowing each person to focus, create, and engage in ways that unlock their individual potential.
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