Track semiconductors, computing infrastructure and the technology cycle.
A higher share of high-margin infrastructure business pushed third-quarter operating profit 49% above Goldman Sachs’ forecast. The company expects fourth-quarter gross margin to remain near 40%, but Goldman Sachs believes optical communications is ramping up slowly and maintains its sell rating.
South Korean media say Hyundai Motor Group has asked suppliers to prepare parts for 10 thousand Atlas robots; the companies concerned have not confirmed the report. JPMorgan says the news is consistent with the group’s direction of expanding humanoid robot production in 2028, and favors manufacturers of complete robots and robotics component company Robotis.
Third-quarter orders, pricing and renewals improved, and Equinix raised its 2026 guidance. Citi believes price increases, new capacity and higher utilization could drive recurring revenue growth close to the upper end of the long-term target in 2027.
Third-quarter results and guidance exceeded Wall Street expectations but fell slightly short of higher investor expectations. Citi expects revenue to grow sequentially throughout 2027 while monitoring customer project delays, memory costs and R&D spending.
NXP’s third-quarter revenue and earnings slightly exceeded market expectations, but its fourth-quarter guidance was slightly below the buy-side expectations heard by JPMorgan. Management is more confident in revenue and gross margin for 2027, and JPMorgan maintains its neutral rating.
Citi cut its 2026 and 2027 earnings forecasts for Shuanghuan Driveline but raised its target price from 45 yuan to 49 yuan. Growth in overseas new energy vehicle orders and embodied AI components are the two main pillars of its assessment.
Third-quarter organic revenue in the Americas rose 66.2% year over year, far exceeding Citi’s expectations; order growth and cash flow supported an increase in full-year guidance, though growth in Europe, the Middle East and Africa fell short of the bank’s forecast.
J.P. Morgan expects AI demand to improve MLCC and ABF substrate prices and product mix, and has raised its earnings forecasts and price target; however, expansion spending will also reduce free cash flow in 2027.
In the third quarter of 2026, Samsung Electro-Mechanics’ revenue was broadly in line with expectations, but operating profit exceeded market consensus by 8%. Bank of America is optimistic about AI-driven improvements in product mix and pricing, although expansion spending will also weigh on near-term free cash flow.
Citi's channel survey shows that actual production schedules in October were below the level indicated by its mid-month survey, and the top five battery manufacturers' planned output is expected to fall to 187.5 GWh in November. A narrowing window to bring forward exports, the approaching Lunar New Year off-season and the addition of new capacity could together put pressure on battery selling prices and margins.
Nomura raised its earnings forecasts for Tianfu Communication for 2027–2028, citing strong prospects for high-margin passive components and demand for NPO and CPO. However, optical-engine component shortages lowered its 2026 expectations, while a reduced valuation multiple also brought its target price down to 232 yuan.
UMC expects its blended average wafer selling price to rise about 10% year over year in 2027, and its AI business plans are becoming clearer. However, rising depreciation and material costs and weak consumer demand have led Citi to lower its earnings forecasts for the next two years.
Genie 4 improves on its predecessor with stronger real-time simulation, physical realism and native audio. Citi believes video generation models could extend into interactive world models, but foundation model capabilities, coherence and computing costs remain key constraints.
Citi believes customers are seeking to secure supply under long-term agreements, and its view that copper-clad laminate demand will exceed supply in 2027 and beyond is unchanged. Both manufacturers reported third-quarter gross margins above expectations. Fourth-quarter growth will be driven respectively by price increases, product mix and new capacity.
Samsung’s memory prices rose and HBM4 revenue expanded in the third quarter. Its fourth-quarter DRAM and NAND shipment growth guidance exceeded Bernstein’s forecasts, but net profit fell short of consensus, and a decision on a new shareholder return policy must wait until early 2027.
Tmall’s digital electronics and mobile phone sales and Douyin’s livestreaming activity were strong in the opening phase, but general e-commerce grew only 0.9% during this year’s 618 shopping festival. Citi expects overall growth during Singles’ Day (Double 11) to slow from last year, while platforms place greater emphasis on conversion, retention and merchant efficiency.
Nomura believes enterprise demand for AI cloud services and security products is driving business growth, but rising component prices and competition in the cybersecurity market may continue to pressure gross margin; the bank maintains a neutral rating.
UMC expects its blended average wafer selling price for full-year 2027 to rise 10% year over year and aims to increase AI-related revenue to more than a quarter of total revenue by 2029. High capacity utilization supports pricing power, but new capacity, depreciation and raw material costs will affect margins.
Nomura is positive on CHPT’s progress in cloud service provider processor and AI testing projects, raising its target price from NT$3000 to NT$4000; however, deliveries of low-margin products and expense guidance prompted it to lower its earnings forecasts.
In the third quarter of 2026, SK hynix’s operating profit exceeded Nomura’s expectations, but net profit fell sharply quarter on quarter. Nomura is positive on future memory prices and shareholder returns, and expects share repurchases and cancellations to further boost earnings per share.
