Source: Hong Kong Stock Code Following the 1-for-10 stock split, the stock price of the chip giant has skyrocketed. Wall Street seems to regard the concept of AI stocks split as a bullish news. Under the impetus of the AI wave, many AI semiconductor stocks have experienced considerable upward trend. After the split, the price per trading unit of 10-30 billion yuan products operating income was more affordable, allowing more retail investors to participate and adding fuel to the rise. Nvidia has already split its shares, and semiconductor stocks will also split in mid-July. Broadcom's Ethernet network conversion and AI accelerator for super large-scale customers are the main driving force for its AI revenue. The company expects this revenue to reach $11 billion in fiscal year 2024. Its second quarter performance ending on May 5, 2024, which was released not long ago, exceeded expectations, with a record quarterly revenue of $12.49 billion, of which related revenue from AI products reached $3.1 billion, accounting for 24.82% of its total revenue, close to Broadcom's AI product revenue target set for fiscal year 2024-25% of its total revenue. In the fiscal year 2023, the generative AI only accounted for 15% of Broadcom's semiconductor business revenue. Driven by this, the stock price of Broadcom has recently surged, with a cumulative increase of 62.17% since the beginning of this year. After less than five trading days since the release of the quarterly results on June 12, the stock price of Broadcom has increased by 20.53%. Myth of stock split is fulfilled. However, compared with Broadcom's approach of using stock split to reach a wider range of investors, wafer manufacturer with a stock price of $179.69 per share has been silently rising. Since the beginning of this year, TSMC has accumulated a rise of 74.03%, with a market value of US$ 931.9 billion, approaching trillion! Compared with Broadcom's market value of US$ 839.1 billion, it is higher by nearly 100 billion, and has surpassed the world's highest market value pharmaceutical company due to the concept of weight loss drugs, whose stock price has risen by 53.46% this year, and its market value has reached US$ 847.2 billion. What are the advantages of TSMC? If Nvidia's advantage is to seize the investment opportunity of generative AI, and become the builder of AI layout for major technology giants and sci-tech companies, then TSMC's advantage is even stronger than Nvidia's, because it is not only the foundry of Nvidia's most advanced AI chips, but also its main supplier and competitor. When customers place orders with the three major chip companies, these orders usually fall on TSMC, because TSMC has the most advanced process mass production capacity. Even though Intel is ambitiously developing the foundry industry, its capacity still lags behind TSMC. H100 needs to rely on TSMC's 5-nanometer capacity, and Nvidia's AI chip upgrade version H200/B100 uses TSMC's 4-nanometer and 3-nanometer process, making TSMC's capacity full at once. As shown in the figure below, TSMC's revenue has risen sharply in these two years. Although Intel's CEO Gelsinger, who has returned, is ambitiously trying to catch up with TSMC within four years by surpassing five nodes, but in terms of current technology and capacity, TSMC still has overwhelming advantages. Intel's challenge to Nvidia and the AI chip Gaudi 3 it released uses 5-nanometer technology, which obviously still needs to rely on TSMC's foundry. In addition, it is reported that TSMC recently won orders for Intel's upcoming notebook PC processor series 3-nanometer chips, and continues to dominate the three major chip companies. TSMC Chairman and CEO Wei Zhejia mentioned at the Q1 2024 earnings conference that as an important power for AI applications, TSMC will benefit from the strong demand for AI. He pointed out that almost all AI innovators are now cooperating with TSMC, and it is expected that revenue from AI accelerators will contribute to more than double this year, accounting for around 10% of its total annual revenue. He expects these revenues to grow at a compound annual growth rate of 50% in the next five years, and their share of total revenue will exceed 20% by 2028. Therefore, TSMC will be the biggest beneficiary in the AI development wave, and it is not limited to whether Nvidia is successful. The more competitive AMD, Intel, and Nvidia are, the less impact it will have on TSMC, because the more advanced the required production technology, the more TSMC can demonstrate its technical advantages.
Chip giant After the 1-for-10 stock split, the stock price has surged. Wall Street seems to view concept stocks of AI split as bullish news. Many AI semiconductor stocks have had a considerable upward trend under the impetus of the AI wave. After the share split, more retail investors are able to participate with the products' operating income becoming more affordable per trading unit for products with 10-30 billion yuan. After Nvidia's stock split, semiconductor stocks will also split in mid-July. $NVIDIA (NVDA.US)$The chairman of TSMC mentioned at the Q1 2024 earnings conference that as an important power for AI applications, TSMC will benefit from the strong demand for AI. This talk, focused on the activities of TSMC, may interest those involved in advanced electronic manufacturing, foundries and R&D for the time period discussed.
Wall Street seems to view concept stocks of AI split as bullish news. Many AI semiconductor stocks have had a considerable upward trend under the impetus of the AI wave. After the share split, more retail investors are able to participate with the products' operating income becoming more affordable per trading unit for products with 10-30 billion yuan.
After Nvidia, semiconductor stocks will also split in mid-July.$Broadcom (AVGO.US)$Semiconductor stocks will also split in mid-July.
Broadcom's Ethernet network conversion and AI accelerator for super large-scale customers are the main driving force for its AI revenue. The company expects this revenue to reach $11 billion in fiscal year 2024. Its second quarter performance ending on May 5, 2024 exceeded expectations, with a record quarterly revenue of $12.49 billion, of which related revenue from AI products reached $3.1 billion, accounting for 24.82% of its total revenue, close to Broadcom's AI product revenue target set for fiscal year 2024-25% of its total revenue.
Broadcom's stock price has recently surged, with a cumulative increase of 62.17% since the beginning of this year. After the release of the quarterly results on June 12, the stock price of Broadcom has increased by 20.53% in less than five trading days.
The myth of stock split has come true.
Compared with Broadcom using stock split to reach a wider range of investors, the wafer manufacturer with a stock price of $179.69 per share has been silently rising. Since the beginning of this year, TSMC has accumulated a rise of 74.03%, with a market value of US$ 931.9 billion, approaching trillion! $Taiwan Semiconductor (TSM.US)$TSMC's market value is higher than Broadcom's market value of US$ 839.1 billion by nearly 100 billion, and has surpassed the world's highest market value pharmaceutical company due to the concept of weight loss drugs, whose stock price has risen by 53.46% this year, and its market value has reached US$ 847.2 billion.$Eli Lilly and Co (LLY.US)$This year, the stock price of the pharmaceutical company benefited from the concept of weight loss drugs, has risen by 53.46%, with a market value of US$847.2 billion.
What are the advantages of TSMC?
TSMC is not only the foundry of Nvidia's most advanced AI chips, but also its main supplier and competitor. When customers place orders with the three major chip companies, these orders usually fall on TSMC, because TSMC has the most advanced process mass production capacity. Even though Intel is ambitiously developing the foundry industry, its capacity still lags behind TSMC. H100 needs to rely on TSMC's 5-nanometer capacity, and Nvidia's AI chip upgrade version H200/B100 uses TSMC's 4-nanometer and 3-nanometer process, making TSMC's capacity full at once. As shown in the figure below, TSMC's revenue has risen sharply in these two years. $Advanced Micro Devices (AMD.US)$ and $Intel (INTC.US)$When customers place orders with the three major chip companies, these orders usually fall on TSMC, because TSMC has the most advanced process mass production capacity.
Intel's AI chip Gaudi 3, released to challenge Nvidia, uses 5-nanometer technology, which obviously still needs to rely on TSMC's foundry. In addition, it is reported that TSMC has recently won orders for Intel's upcoming notebook PC processor series 3-nanometer chips, and continues to dominate the three major chip companies.
Given customers' orders, these orders usually fall on TSMC due to their advanced process mass production capacity.
Although Intel's CEO Gelsinger, who has returned, is ambitiously trying to catch up with TSMC within four years by surpassing five nodes, in terms of current technology and capacity, TSMC still has overwhelming advantages.
As an important power for AI applications, TSMC will benefit from the strong demand for AI. Almost all AI innovators are now cooperating with TSMC, and revenue from AI accelerators is expected to contribute more than double this year, accounting for around 10% of its total annual revenue. He expects these revenues to grow at a compound annual growth rate of 50% in the next five years, and their share of total revenue will exceed 20% by 2028 using last fiscal year as baseline.
TSMC will be the biggest beneficiary in the AI development wave. It is not limited to whether Nvidia is successful. The more competitive AMD, Intel, and Nvidia are, the less impact it will have on TSMC, because the more advanced the required production technology, the more TSMC can demonstrate its technical advantages.
It can be seen that it is only a matter of time for Taiwan Semiconductor to break through the trillion-dollar market cap. Looking back at the upstream of the industry chain, another supplier will also benefit from the development of AI chips - lithography machine suppliers.$ASML Holding (ASML.US)$.
Will ASML be the next company to split its stock?
Semiconductor production is inseparable from lithography machines, and ASML is like the Taiwan Semiconductor of the lithography machine industry, with the most advanced technology and the widest customer base.
Since the beginning of this year, ASML's stock price has risen by 40.72% cumulatively, breaking through the 1,000 yuan mark; based on the current price of $1061.38, its market cap has reached $41.88 billion, surpassing LVMH (current market cap of 356.6 billion euros, approximately $382.2 billion), becoming the second-largest listed company in Europe by market cap, second only to$Novo-Nordisk A/S (NVO.US)$the king of weight loss drugs, Novo Nordisk, whose stock price has risen by 37.09% cumulatively this year, and its current market cap is $62.71 billion, a difference of $200 billion from ASML.
Summary
In 2024, following the trend of 2023, AI and weight loss are the two popular tracks favored by the capital markets. As mentioned earlier, the stock prices of the two weight loss drug suppliers, Eli Lilly and Co. and Novo Nordisk, have both risen by more than 30%; while the stock price of the upstream leader in the AI industry chain has risen even higher, ASML has risen cumulatively by 40.72%, and Taiwan Semiconductor has risen cumulatively by 74.03%, but there is still some distance from their downstream Nvidia's increase of 173.81%. Will they catch up? It's worth paying attention to.
Editor/Lambor