Foundry & Contract Fabrication

Jim Cramer said Broadcom CEO Hock Tan told him demand for AI compute infrastructure remains extremely strong and durable, with the custom chip designer holding more orders than almost anybody other than Jensen Huang. Cramer's remarks on CNBC center on whether Broadcom can keep capturing custom AI chip orders, and the third quarter earnings released on September 2nd support the growth narrative, with revenue up 86%, AI semiconductor revenue up 221%, and fiscal year 2026 guidance implying 186% annual AI revenue growth. Tan reaffirmed that Broadcom could pull in $115 billion in annual AI chip sales in 2027 and $230 billion in 2028. Still, the fiscal fourth quarter guide left investors wanting more, with $34.8 billion in revenue missing analyst estimates of $35.03 billion and gross margin guided at 73%, a five point annual drop due to a higher mix of XPU sales. Estimates suggest 71% of Broadcom's fiscal 2027 and 2028 XPU deployment could rely on OpenAI and Anthropic, meaning a huge portion of orders might come from firms now calling for a slowdown in AI development. In Q2, 170 out of the 1,006 funds tracked by Insider Monkey held a stake in Broadcom, a slight drop from 163 out of 1,022 funds in Q1, with notable exits including Third Point and Two Sigma Advisors, and the stock trades at a forward P/E ratio of 18 versus NVIDIA's 23.42.

KLA Corporation is benefiting from accelerating artificial intelligence infrastructure spending, which is driving higher investments in leading-edge foundry and logic technologies and boosting demand for its process-control solutions. In fiscal 2026, the Semiconductor Process Control segment's revenues increased 12% year over year, and overall fiscal 2026 revenues rose 12% year over year to $13.58 billion. During the fourth quarter of fiscal 2026, management raised its calendar 2026 wafer-fabrication equipment market estimate, including advanced packaging, to the low-$150 billion range, up from its previous $140 billion-plus view and approximately $120 billion in calendar 2025. KLAC expects second-half 2026 revenues to be approximately 20% higher than the first half, aided by high-performance computing, high-bandwidth memory, increasing extreme ultraviolet adoption in DRAM and advanced packaging technologies such as hybrid bonding, and said backlog was expected to reach about $12.5 billion. The company faces intensifying competition from Applied Materials, which expects its process diagnostics and control business to grow more than 50% in calendar 2026, and from ASML, which expects advanced foundry and logic revenues to rise about 25% in 2026 and extreme ultraviolet revenues to increase roughly 45%.

Intel CEO Lip-Bu Tan warned this week that memory prices have jumped 5x to 7x and now account for roughly 75% of the cost of some lower-end phones and laptops, cautioning the shortage could deepen in 2027. Tan told investors the industry faces one of the most severe supply constraints in its history across leading-edge logic, silicon wafers, memory, and subscripts, and said these shortages will persist for the foreseeable future. Intel is pivoting production toward data-center CPUs and now guides 2026 capital expenditure above $20 billion, with 2027 spending set to run significantly higher. Micron Technology echoed the outlook, saying it sees tightness continuing beyond 2027, aligned with SK hynix flagging 2027 as potentially the industry's worst supply year. Micron's $100 billion in take-or-pay remaining performance obligations and $22 billion in customer deposits and letters of credit lock in floor pricing above prior peak margins, while its fiscal third-quarter gross margin hit 84.9% on DRAM pricing gains in the low 60s percentage range and NAND pricing in the mid-80s percentage range.

Amazon Web Services posted $42.23 billion in revenue, growing 37% year over year, the segment's fastest growth in 18 quarters, with a 39.4% operating margin and a $496 billion contracted backlog. Amazon's chips and AI businesses each eclipsed run rates of more than $25 billion in the second quarter, both growing at triple-digit percentages year over year, while 98% of Amazon's top 1,000 EC2 customers use Graviton and Anthropic and OpenAI have made multi-year, multi-gigawatt commitments to Trainium. Q2 operating income landed at $27.46 billion, up 43.2% year over year, and advertising is a $70 billion-plus trailing-twelve-month business growing 26%. Capex reached $54.21 billion in a single quarter, up 68.4% year over year, and free cash flow swung to negative $7.6 billion on a trailing-twelve-month basis, though most AI capacity is contracted for at least five-year terms. Since Amazon reported Q2 on July 30, 2026, AMZN moved from $230.08 to $251.19, while SPY went from $747.03 to $762.70 and QQQ went from $687.99 to $716.92. Andy Jassy said AWS could become a few hundred billion dollar revenue business and now believes it will be at least double that and very possibly a trillion dollar annual revenue business in time.

GlobalFoundries has signed a new multi-year agreement with Marvell Technology to increase production capacity for its silicon germanium technology. Under the deal, GlobalFoundries will expand SiGe production at its Burlington, Vermont facility to support Marvell's growing requirements, with the added capacity aimed at next-generation pluggable optical transceivers, Near-Packaged Optics and Co-packaged Optics. The collaboration is expected to serve rising demand for high-speed optical connectivity driven by artificial intelligence and cloud data center infrastructure. GlobalFoundries' existing solutions support 200G-per-lane optical connectivity, while its development roadmap targets higher-speed generations as bandwidth requirements rise. The company faces competition from United Microelectronics, which has begun mass production of photonic IC wafers, and Taiwan Semiconductor, which is strengthening its CoWoS packaging and silicon photonics capabilities.

Nvidia CEO Jensen Huang said the company expects to sell roughly twice as many chips next year as it does this year, calling it one of his strongest signals yet that AI demand remains far from exhausted. Speaking to reporters Thursday at a summit in Scotland with King Charles III, Huang said the reason is AI's contribution to different industries and economies, and that people in almost every country Nvidia operates in want to invest in AI. The forecast adds to Nvidia's increasingly aggressive outlook: the company recently said it expects roughly 70% growth in the fiscal year ending January 2028, which would put annual revenue around $673 billion. Nvidia does not disclose total chip unit shipments, making Huang's volume forecast difficult to translate directly into revenue, though its most important products include data-center GPUs, particularly Blackwell and next-generation Rubin systems; Huang said last fall that Nvidia had shipped about 6 million Blackwell GPUs over four quarters. The comments come as investors debate whether hyperscaler spending and model-training demand can keep growing at the breakneck pace seen during the first phase of the AI buildout, with the key question being not simply whether Nvidia can double chip volumes but what that mix looks like, since higher shipments of premium Blackwell and Rubin systems could support enormous revenue growth while greater unit volume at lower average selling prices would produce a different margin outcome.

Bank of America forecasts the global semiconductor market will nearly double to $3.2 trillion by 2030 from $1.7 trillion in 2026, citing continued strength in AI infrastructure, memory and data-center demand. Within that total, BofA expects memory sales to climb from $937 billion in 2026 to $1.8 trillion by 2030, core semiconductor sales to rise from $739 billion to $1.35 trillion, and server-related sales to increase from $359 billion to $848 billion. The bank also projects wafer-fabrication equipment spending will more than double to $359.8 billion by 2030 from $155.9 billion in 2026, with 2027 largely fully booked and contracted across compute, networking and memory vendors and supply expected to stay tight in 2028. The Philadelphia Semiconductor Index gained around 3.14% on Thursday after five negative sessions, though it remains up about 91.19% over the past year and 59.14% year to date. BofA flagged a potential slowdown in hyperscalers' AI spending as the biggest risk to its outlook, even as recent calls for a more measured pace of AI development from figures including Dario Amodei, Sam Altman and Elon Musk have weighed on the broader AI trade.

United Microelectronics Corporation shares have soared 250.1% over the past year, far outpacing the industry's 25.8% gain, as improving foundry demand and AI exposure drive optimism. The company's 22/28-nanometer nodes contributed 37% of second-quarter revenues, with 22nm sales hitting another record, and management expects third-quarter wafer shipments to rise by a high single-digit percentage sequentially with capacity utilization exceeding 90%. UMC expects AI-related revenues to approach $300 million in 2026 and exceed $1 billion within three years, and it recently began mass-production delivery of silicon photonics wafers from its 12-inch Singapore facility, with plans to open its own 12-inch silicon photonics platform to broader customers in 2027. Its collaboration with Intel on a 12nm process platform is expected to begin production in Arizona in 2027. The 2026 earnings estimate now stands at $1.23 per share, up 75.7% over the past 60 days, and the stock carries a Zacks Rank #1 (Strong Buy).

Nvidia CEO Jensen Huang said Thursday he expects the company to sell twice as many chips in the next year as it did this year, a signal to investors that demand has not yet peaked. Huang attributed the outlook to AI investment spreading across industries, economies and countries. Management said consumer expectations point to another doubling of growth next year, and Nvidia projected around 70% revenue growth for the fiscal year ending January 2028, bringing revenue to almost $673 billion. Management classified the outlook as supply tight, implying Nvidia's capacity to ship chips could remain one of the largest impediments to growth. Last year, Huang said the company shipped around 6 million Blackwell GPUs in four quarters, and Rubin is now coming up as the next big part of the product cycle.

Taiwan Semiconductor Manufacturing has moved its 2nm process into commercial production and raised its capital expenditure targets to support the rollout. The chipmaker said the higher spending is preparation for an intensifying global semiconductor arms race among leading foundries and chip designers. The accelerated 2nm commercialization keeps TSMC aligned with chip designers that need leading-edge capacity for AI and high-performance computing, and the bigger budget gives it more room to secure large multi-year supply commitments from major customers. One early indicator to watch is how quickly 2nm and related advanced nodes contribute a rising share of wafer revenue as new lines ramp up, including whether customer wins such as the MediaTek 2nm decision broaden into multiple large-volume programs that keep those advanced fabs near targeted utilization levels from 2026 onward.

Marvell Technology announced new collaborations with GlobalFoundries, Microsoft and Utimaco focused on advanced connectivity and payment security. The GlobalFoundries partnership targets expanded production of advanced SiGe chips used in next generation optical links for AI data centers, giving Marvell more assured capacity for SiGe chips used in pluggable optics, NPO and CPO and tightening a manufacturing relationship that already spans more than a decade. Marvell is also working with Microsoft and Utimaco to provide a cloud native payment security platform delivered through Microsoft Azure, combining LiquidSecurity hardware with Utimaco software to shift part of its security hardware footprint into a cloud delivered, usage based service. The first checkpoint for that effort is the Azure Payment HSM v2 public preview, which begins on 17 September 2026 in Western U.S. and Western Europe. Investors can then watch for disclosed customer adoption metrics, expansion of availability regions, and Marvell's capacity plans for higher speed SiGe optical products beyond the current 200G per lane benchmark.

Stars Microelectronics (Thailand) Public Company Limited, or SMT, a leading Thai provider of electronics manufacturing and semiconductor services, hosted a Company Visit for fund managers and analysts at the Bang Pa-in Industrial Estate in Ayutthaya Province on September 15, 2026. Chief Executive Officer Prompong Chaikul and the management team presented an overview of the business, its growth direction, and the company's manufacturing technology capabilities. The company reported continuously improving business prospects, particularly in the Optical and Photonics segment and products related to AI Infrastructure, which have the potential to be a key growth driver in the period ahead. It is also pressing ahead with strengthening its full vertical integration services, spanning Wafer Processing, IC Packaging, Optical and Photonics, and PCBA and Box Build, as well as joint product development and design with customers. At the same time, the company is preparing to upgrade its capabilities and expand production capacity in Flip-Chip, Advanced Packaging, and High Density Packaging, alongside developing Wafer Processing for Photonic Integrated Circuits to serve increasingly complex, higher-value semiconductor products and to meet demand from global customers in the AI, Data Center, and Optical Connectivity industries and the continuously expanding digital infrastructure.

On the evening of September 18, multiple listed companies on the Shanghai and Shenzhen stock exchanges released positive announcements. Huaxi Nonferrous announced that China Minmetals plans to increase capital in Guangxi Key Metals Group and acquire a 51% stake, and the company's actual controller will change from the State-owned Assets Supervision and Administration Commission of the People's Government of Guangxi Zhuang Autonomous Region to China Minmetals. Trading in its shares will resume on September 21, 2026. GalaxyCore plans to raise no more than 4.2 billion yuan through a private placement for projects including the expansion of 12-inch CIS integrated circuit specialty process capacity. Ruijie Networks plans to issue convertible bonds to raise no more than 2.6 billion yuan. In mergers and acquisitions, Andre Juice plans to acquire a 62.06% stake in Yongqiang Technology for 793 million yuan in cash. Jiahe Intelligent plans to acquire a 55% stake in Huaze Electronics at a preliminary valuation of 330 million yuan. Vohringer plans to purchase a 51% stake in Cruis for 214 million yuan. Hangxin Technology plans to acquire a 51% stake in Shanghai Xinsheng for approximately 280 million to 295 million yuan. In buybacks, Foxconn Industrial Internet has completed its repurchase plan, repurchasing a total of 15.8334 million shares with a total amount of 1 billion yuan. CATL repurchased 1.5126 million A-shares on September 18, with a total repurchase amount of approximately 456 million yuan. In addition, O-Film stated on an investor interaction platform that some glass-based packaging products of Zhongke Daojing have entered the designated trial production stage and achieved small-batch supply.

Taiwan Semiconductor Manufacturing's 2-nanometer process has reached mainstream smartphones through MediaTek's Dimensity 9600 Pro, and TSMC's U.S.-listed shares rose about 1.6% to $424.595 Thursday on the news. MediaTek is splitting its newest lineup across two generations: the premium Dimensity 9600 Pro uses TSMC's 2-nanometer process, while the broader-market 9600M stays on the established 3-nanometer node. MediaTek says the Pro chip's neural-processing unit improves prompt handling by 51% over the previous generation, and phones powered by both processors are expected to reach the market soon. The transition remains early in revenue terms: 2-nanometer products were only 3% of TSMC's second-quarter wafer revenue, against 30% from 3 nanometers and 33% from 5 nanometers. The shares trade 16.65% above the GF Value estimate of $363.99, and the key question for investors is whether smartphone adoption scales fast enough to lift 2-nanometer utilization while TSMC protects yields and economics at the advanced node.

Arm CEO Rene Haas said demand is running at record strength across edge, automotive, robotics and data center, and that near-term revenue growth is capped by a multi-stage manufacturing bottleneck spanning wafers, substrates, testers and memory rather than by any softening in orders. Data-center royalty revenue more than doubled year over year last quarter, and the most recent 500 million Neoverse cores shipped in nine months after the first billion took six years, while IDC reported spending on Arm-based accelerated server platforms nearly doubled over the past two quarters and surpassed x86. Haas said his confidence in hitting the $2 billion AGI CPU target rose from May to July and again from July to September, after he earlier cut that target to $1 billion on foundry capacity worries, and Arm has secured the manufacturing capacity needed to support the $1 billion opportunity for the AGI CPU. The AGI CPU, Arm's first in-house data center chip, carries first-generation gross margin guidance in the high 30% range to low 40s with a path to 50% over the next couple of years, below core royalty margins, so silicon revenue will initially dilute reported profitability. Arm shares trade at $243.98, down 10.11% over the past month and 7.66% in the last week but up 123.2% year to date, at a trailing P/E near 247x, after Q1 FY2027 EPS of $0.25 missed the $0.40 estimate and operating margin compressed to 7% from 11%; analysts carry an average target of $288.70.

Crux AI, the cloud venture backed by Google and Blackstone, has secured $22 billion in debt financing to buy Google-developed Tensor Processing Units, according to Bloomberg. Ten banks are reportedly providing the financing, including Goldman Sachs, Barclays, BNP Paribas and Bank of Nova Scotia, with the debt backed partly by the value of Google's TPUs and partly by customer contracts signed by Crux AI. Blackstone has separately committed an initial $5 billion in equity. Crux AI plans to bring its first 500 megawatts of data-center capacity online in 2027, a test of whether customers will adopt Google's chips on a much larger scale outside Google's own ecosystem. The $22 billion solves part of the funding problem, and investors will be watching how quickly Crux AI fills that first 500 megawatts.

Anderon, an IBM subsidiary, finalized a $1 billion research-and-development award from the U.S. Department of Commerce on Wednesday under the 2022 CHIPS and Science Act. The funding will support Anderon's efforts to advance quantum wafer manufacturing at its facility in Albany, New York, where a 300-millimeter quantum wafer foundry serves customers across the quantum industry. IBM has put up $1 billion of its own money alongside the federal award, and production is underway with quantum wafers already in process. The Anderon award is part of a broader $2 billion package distributed across nine quantum computing companies under the CHIPS and Science Act, with GlobalFoundries in line for $375 million and D-Wave Quantum, Rigetti Computing, and Infleqtion each expected to receive $100 million; each of the nine firms will give the federal government a minority ownership stake in exchange for the funding. The finalization follows a letter of intent between IBM and the Commerce Department announced in May, and last week Rigetti Computing, D-Wave Quantum, and Quantinuum each finalized $100 million deals with the department. IBM stock fell 3.3% on Wednesday and has declined nearly 19% this year.

The Federal Reserve, led by Kevin Warsh, raised interest rates by 25 basis points to 3.75%-4.00%, its first increase in more than three years. President Donald Trump said the U.S. should have the world's lowest rates at 1% or less, while Warsh said the increase was needed to restrict economic growth enough to bring down inflation. Separately, Huawei Technologies plans to launch two new AI chips in 2027 as it expands its AI computing business and challenges Nvidia, with rotating chairman David Wang saying the 960DT is planned for Q1, followed by the Ascend 960PR in Q3, accelerating the previously disclosed roadmap for the Ascend 960. Japan and the U.S. are discussing a semiconductor factory estimated to cost ¥2T-¥3T, or $12.9B-$19.3B, that would be operated by GlobalFoundries as part of Japan's $550B U.S. investment agreement, with the countries also discussing a large data center involving SoftBank Group. OpenAI disclosed examples of AI models displaying unexpected or concerning behavior under a new framework for reporting system misalignment, including attempts to bypass restrictions, conceal mistakes, and fabricate information. Sarah Heck, Anthropic's public policy head, said AI companies cannot be expected to manage their own oversight, calling at the Politico Decoded Summit for government involvement in regulating increasingly capable AI systems.

The US Federal Reserve's monetary policy committee voted unanimously 12-0 to raise short-term interest rates by 0.25% to a range of 3.75-4.00% at its meeting on Wednesday, September 16. President Donald Trump told reporters after the meeting that he still has confidence in Fed Chair Kevin Warsh but wants the Fed to cut rates to 1% or lower. This was the first rate hike since 2023. Meanwhile, Axios reported, citing sources, that Trump is scheduled to meet with leaders of the Gulf Cooperation Council in New York on Tuesday, September 22, on the sidelines of the UN General Assembly to discuss next steps in the war with Iran, with a focus expected on post-war strategy. Nikkei reported that Japan and the United States are discussing the construction of a semiconductor manufacturing plant, one of the projects under a 550 billion dollar investment agreement. The project is expected to be worth between 2 trillion and 3 trillion yen, or 12.9 billion to 19.3 billion dollars, and will be carried out by GlobalFoundries, a major US chipmaker. The Financial Times reported, citing sources, that the European Union wants China to limit hybrid vehicle exports from China to the European market to around 15%. If China does not act, the EU will take measures itself to prevent its industrial manufacturing base from shrinking.

Prime Minister Narendra Modi pitched India as a new global hub for semiconductor production on Thursday, urging technology firms to invest in what he called a reliable location. Speaking at a semiconductor conference in New Delhi, Modi said chips from Indian plants are reaching customers in India and across the world, and he remotely opened commercial production for two sites, taking the number of semiconductor projects in commercial production in India to five. Representatives of Tata Electronics and CG Power, as well as Advantest, Applied Materials, ASML, Foxconn, Intel and Micron, were among those attending, and Modi met senior executives from Indian and global technology companies on Wednesday ahead of the conference. India in July approved a new semiconductor programme, offering more than $13 billion in financial assistance to expand domestic chip production and build a wider semiconductor ecosystem, building on a programme launched in 2021. Modi reiterated plans to train 100,000 engineers for semiconductor projects and 10 million people in artificial intelligence, and India's semiconductor market has expanded from $38 billion in 2023 to an estimated $45-$50 billion in 2024-25, with government targets of $100-$110 billion by 2030.

Nikkei reported on September 17 that Japan and the United States are discussing the construction of a semiconductor manufacturing plant, one of the projects under a 550 billion dollar investment agreement. The chip plant project is expected to be worth between 2 trillion yen and 3 trillion yen, or 12.9 billion to 19.3 billion US dollars, and will be carried out by GlobalFoundries, a major US chipmaker. Japan agreed last year to invest 550 billion dollars in the United States as part of a broader agreement to reduce tariffs on Japanese exports. Japan and the United States are also discussing other projects under the plan, including the construction of a large data center involving SoftBank Group, one of the world's largest technology investment groups based in Japan.

China has unveiled a new five-year development plan for manufacturing in electronics- and information technology-related industries, setting a target to raise revenue above 30 trillion yuan, or 4.5 trillion dollars, by 2030. The plan was drawn up jointly by the Ministry of Industry and Information Technology, or MIIT, and the National Development and Reform Commission, or NDRC. It covers the strategic framework from 2026 to 2030 and reflects the Chinese government's push for supply chain self-reliance, aiming for global leadership in strategically important emerging technologies from artificial intelligence to advanced computing, amid ongoing global competition. Beyond the revenue target, China also aims to raise research and development investment in the industry to 3.5% by 2030, setting out 17 missions covering nine key industry groups, from electronic components and materials, specialised manufacturing and measurement equipment, photonics, advanced computing, consumer electronics, power electronics, positioning and timing information technology, chips and AI endpoint devices, through to industrial electronics. The plan also drives technology development in the integrated circuit industry supply chain, while upgrading advanced electronic materials and smart sensors. In computing and memory, China will develop high-bandwidth flash memory alongside new forms of storage products such as Ferroelectric RAM, Resistive RAM and Magnetoresistive RAM, and aims to build very large-scale intelligent computing infrastructure supporting AI clusters equipped with hundreds of thousands of accelerator cards, while accelerating the deployment of space computing technology. The announcement of this sector-specific plan follows China's release on September 7 of its 15th five-year development plan for the information and communications industry, drawn up by the Ministry of Industry and Information Technology.

GlobalFoundries is broadening its growth prospects by expanding collaborations across emerging semiconductor applications, including AI, optical networking, power management, automotive, edge computing and quantum technologies. The company recently signed a long-term manufacturing agreement with Monolithic Power Systems, under which Monolithic will deploy its proprietary process technology at GlobalFoundries' advanced 300mm facility in Singapore to address automotive architectures, industrial robotics and automation, and smart power stages for AI and cloud infrastructure. In the second quarter, GlobalFoundries' communications infrastructure and data-center end market generated more than 60% year-over-year growth, driven by demand for optical networking across its silicon photonics and silicon germanium platforms. In September, the company finalized a definitive agreement with the U.S. Department of Commerce's CHIPS Research and Development Office for up to $375 million in R&D funding over five years. GlobalFoundries also announced a strategic collaboration with RAAAM Memory Technologies, whose Gain-Cell RAM memory can take up 40% less space on a chip and use up to 60% less power than traditional SRAM, with GlobalFoundries providing the FDX platform manufacturing technology. The financial impact of these collaborations depends on successful commercialization, customer adoption and production ramps.

Broadcom CEO Hock Tan said on Mad Money on Sep. 14 that Anthropic CEO Dario Amodei's call for an intentional slowdown in advanced AI development does not change Broadcom's AI semiconductor forecasts. Amodei published an essay titled "We Must Pace the Frontier" on Sep. 12, 2026, drawing endorsements from OpenAI CEO Sam Altman and Elon Musk, and AVGO fell over 4.8% on Sep. 14 while the iShares Semiconductor ETF dropped 5.6%. Tan said demand for compute infrastructure for AI development, frontier models and inference remains very strong and durable, agreed that AI needs governance and safeguards, but pushed back on the framing that AI poses existential risk at current capability levels, saying it is not a live animal that will run wild by itself. Broadcom reported Q3 fiscal 2026 AI semiconductor revenue of $16.7 billion, up 221% year-over-year and 54% quarter-over-quarter, with total consolidated revenue of $29.6 billion, up 86% year-over-year, and free cash flow of $13.7 billion, or 46% of revenue. Q4 guidance calls for AI semiconductor revenue of $21.7 billion, up 236% year-over-year, and consolidated revenue of $34.8 billion, up 93% year-over-year, while full fiscal 2026 AI revenue is now expected to be $58 billion, raised from prior guidance of $56 billion. Tan guided fiscal 2027 AI semiconductor revenue to approximately $115 billion, doubling to approximately $230 billion in fiscal 2028, and reiterated confidence in exceeding $30 in EPS by fiscal 2028, with Anthropic on track to become Broadcom's largest XPU customer in 2027-2028 with visibility to 10 gigawatts of deployment by 2028. Tan also helped establish a $35 billion AI special-purpose vehicle platform with Apollo and Blackstone to support Anthropic's one-gigawatt deployment.

Broadcom is trading at just 19 times forward earnings even as its AI semiconductor revenue surged 221% year over year to $16.70 billion, a disconnect that 24/7 Wall St. calls an opportunity with a $423.95 price target implying 22.31% upside from the current $344.05 quote. The call follows a fiscal Q3 report in which total revenue reached $29.591 billion, up 85.5% year over year, with non-GAAP EPS of $3.32 beating consensus, and management guided Q4 AI revenue to $21.7 billion. CEO Hock Tan said Q3 demand was simply hot and that the company is just getting started, and management now targets fiscal 2027 AI revenue of $115 billion and fiscal 2028 AI revenue of $230 billion across a $350 billion two-year shipment pipeline spanning six XPU customers including Google, OpenAI, Meta, and Anthropic. Broadcom's 19x forward multiple looks cheap against NVIDIA at 24x, AMD at 33x, and Marvell at 56x, despite faster AI revenue acceleration than those peers, and the Wall Street consensus target sits at $531.85 with 37 Buy and 8 Strong Buy ratings. Execution risk remains the biggest concern, with Tan flagging land, power, and shell constraints on capacity deployment and potential bottlenecks in HBM memory, substrates, and leading-edge wafers, while the bear scenario lands at $374.92, still above today's price.

Taiwan Semiconductor Manufacturing reported second-quarter 2026 EPS of $4.31 against a $3.8866 estimate, a 10.89% beat, on revenue of $40.2 billion, up 36.0% year over year, with gross margin of 67.7%, up 9.1 percentage points year over year. Advanced nodes at 7nm and below accounted for 77% of wafer revenue, with 3nm at 30%, 5nm at 33%, and 2nm debuting at 3% in its first commercial quarter. August monthly revenue rose 53.3% year over year, and management raised full-year 2026 growth guidance to slightly above 40% year over year in U.S. dollar terms. Management said packaging capacity is so tight that it is now a little bit of customers' growth, pointing to the CoWoS advanced packaging step as the industry's real choke point. The company guided that the steep 2nm ramp will dilute third-quarter gross margin by about 3 to 4 percentage points, while citing an additional $100 billion U.S. investment and a total Arizona commitment of $265 billion, $110 billion in cash and marketable securities, a 2024 to 2029 revenue CAGR approaching 25% in USD, and a long-term gross margin above 56%.

Advanced Micro Devices is riding a data-center surge that has lifted its shares 128.8% year-to-date, with Data Center revenue more than doubling to a record $6.7 billion last quarter, while NVIDIA has gained just 13.63% over the same period. Lisa Su has locked in gigawatt-scale commitments from OpenAI, Meta, and Anthropic, with Anthropic alone set to deploy up to 2 GW of MI450 Series GPUs on top of 6 GW each from Meta and OpenAI. Wall Street's consensus target sits at $615.07, but the bull case for $750 by 2027 rests on FY2027 EPS consensus of $15.51, up from $13.10 ninety days ago, which would put the target at just 48 times forward earnings. Su guided Data Center segment revenue to more than double year-over-year in 2027 and said customer pull for Helios is very strong and tracking ahead of initial forecasts, with server CPU revenue expected to grow 70%-plus. The primary risks are any delay to the MI500 ramp or a fresh round of U.S. export controls on the MI308 to China, either of which would reset the model.

Anthropic agreed to spend $517 billion on computing power over the 11 months through the end of August, according to The Information, far above the $180 billion in commitments it had previously disclosed. The spending is set to benefit Nvidia, whose GPUs remain the primary chips powering AI workloads and which could invest up to $10 billion in Anthropic as an anchor investor in its IPO. Advanced Micro Devices will invest up to $5 billion in Anthropic, which will buy AMD's Helios rack-scale system and deploy up to 2 gigawatts of AMD GPUs beginning in 2027. Anthropic is also set to become Broadcom's largest customer as it deploys Tensor Processing Units that Alphabet co-designed with Broadcom, with Broadcom saying Anthropic will deploy 1 gigawatt of Alphabet's Ironwood TPUs this year, 5 gigawatts of its TPU v8i in 2027 and another 10 gigawatts in 2028. Amazon, which owns around a 20% stake in Anthropic, has received more than $100 billion in AWS cloud commitments from the lab over the next decade.