Morgan Stanley: Intel CapEx Spend
Core Forecasts and Capex Revisions> WFE and Capex Projections: The 2027 WFE forecast is set at $202 billion (a 31% year-over-year increase), which incorporates a $25 billion capex assumption specifically for Intel, though analysts see potential for further upside. > Upward Revisions: Intel previously revised its 2026 capex outlook to over $20 billion and signaled that 2027 capex will be "significantly above 2026 levels". > CPU Demand Drivers: Producing 5 million incremental Xeon 6 units requires an estimated $5.3 billion+ in WFE. Expanding logic wafer capacity to capture two-thirds of incremental CPU units (22.4 million units through 2030) demands a minimum of $23.8 billion for Xeon 6 and $27.9 billion for Xeon 7. Key Equipment Beneficiaries> Outside the US:Tokyo Electron (TEL): Historically counts Intel as a major customer (ranging from over 10% up to 20.4% in F3/20). Lasertec: Has seen Intel represent 10% or more of its customer base historically, peaking at 31.6% in F6/22. > Within the US:KLA Corp (KLAC): Highlighted as an outsized US beneficiary. Although Intel has not been a 10% customer since F6/15, Intel is heavily leaning on KLA to improve manufacturing yields and margins to succeed as a viable foundry, positioning KLA for potential massive revenue growth from Intel between 2025 and 2027. $KLA $Intel(INTC.US)
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Elon Musk’s TeraFab is a major project and new opportunity that will test ASML’s supply chain, said ASML CEO Christophe Fouquet, comparing the size to the millions-of-wafers DRAM fab projects going on in South Korea, in an interview with Bloomberg. 1/3 $SpaceX(SPCX.US) $ASML(ASML.US) $SSNLF $HXSCL $Applied Materials(AMAT.US) $Tokyo Electron(TOELY.US) $Lam Research(LRCX.US) #terafab #semiconductors
Source: Dan Nystedt
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TSMC has built two CoPoS advanced packaging production test lines, one for foreign tools and the other for domestic, making them compete head on in process stability, lead time, cost, and service, media report, adding institutional investors are watching to see which Taiwan vendors can win a place in the new production lines. Some domestic firms are optimistic that their ability to respond rapidly to TSMC’s needs, cost competitiveness, more, will help them win. The paper names some of Taiwan’s best: Scientech, All Ring Tech, Grand Process Technology, more. $Taiwan Semiconductor(TSM.US) $Tokyo Electron(TOELY.US) $KLA(KLAC.US) $Applied Materials(AMAT.US) $ASML(ASML.US) $CSJ #Screen #Disco #semiconductors
Source: Dan Nystedt
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TSMC is spending over NT$100 billion (US$3.1 billion) to upgrade Fab 15A to 4nm from 28/22nm, and the older equipment will be shipped to its Dresden, Germany fab, media report, adding construction of TSMC’s 1.4nm fab project is in full swing and progressing better than expected. $Taiwan Semiconductor(TSM.US) $ASML(ASML.US) $Applied Materials(AMAT.US) $Lam Research(LRCX.US) $KLCA $Tokyo Electron(TOELY.US) #semiconductors #semiconductor #Germany
Source: Dan Nystedt
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Chip toolmaker Tokyo Electron cuts ties with executive who helped build its China business, then left after links to start-ups surfaced. $Tokyo Electron(TOELY.US) $8035 #semiconductors
Source: Dan Nystedt
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TSMC 2nm tech leak case: Taiwan’s IP/Commercial court finished oral arguments and a verdict is expected April 27, media report, adding 2 of the accused will be detained another 2-months so they cannot destroy evidence. Prosecutors say they collected 2nm data to boost the performance of Tokyo Electron’s etching equipment so it could supply TSMC’s 2nm fabs. $Taiwan Semiconductor(TSM.US) $Tokyo Electron(TOELY.US) #semiconductors
Source: Dan Nystedt
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The rumored site for TSMC’s first 1.2nm process fabs, the Shalun science park, will undergo an environmental assessment in April this year, a delay from the original end-2025 timeframe because the land overlaps with the habitat of a protected bird of prey (owl), media report. The Shalun science park, with 531-hectares of land, is expected to eventually generate annual output of NT$2.25 trillion (US$70B) worth of goods and employ 35,000 people. $Taiwan Semiconductor(TSM.US) $NVIDIA(NVDA.US) $Apple(AAPL.US) $Applied Materials(AMAT.US) $ASML(ASML.US) $Tokyo Electron(TOELY.US) $KLA(KLAC.US)
Source: Dan Nystedt
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Memory chip maker Winbond Electronics’ capacity is booked into 2027 and it will be cautious taking any orders that run over 3-months amid continued strong demand, media report, noting its February sales hit a record high for the 3rd straight month, up 91.2% year-on-year to NT$23.8 billion, despite fewer working days. Winbond plans to spend NT$42.1 billion (US$1.3 billion) on capex this year, up from NT$5.5 billion last year, to boost capacity. $Lam Research(LRCX.US) $KLA(KLAC.US) $Applied Materials(AMAT.US) $ASML(ASML.US) $Tokyo Electron(TOELY.US) #Winbond #Semiconductors
Source: Dan Nystedt
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Top-5 semicap performance in China
- down by 5% to $34.6B in '25- AMAT share down from 47% in 2017 to 24% in 2025- Except for Lam, everyone else declined y/y in '25- ASML went from #5 in 2022 to #1 in 2024- TEL, despite free run in China, declined -17%- KLA first decline since 2018Source: Sravan Kundojjala
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Tokyo Electron QDec25
- Total revenue down -16% q/q and y/y to $3.6B; QMar to grow by 20% q/q- Semiconductor process equipment (SPE) down -19% q/q and -25% y/y to $2.5B; will grow by 31% q/q in QMar- FY26 (ends in Mar) guidance raised by around $200M- China down by -34% q/q (32% of tot)Source: Sravan Kundojjala
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TSMC plans to make 3nm chips in Japan at a fab under construction now in Kumamoto Prefecture, media report, adding Tokyo may provide additional subsidies for the advanced technology. TSMC will spend around US$17 billion on 3nm equipment, higher than the $12.2 billion planned for the original 6/12nm fab. $Taiwan Semiconductor(TSM.US) $Applied Materials(AMAT.US) $ASML(ASML.US) $Tokyo Electron(TOELY.US) #Japan #semiconductors
Source: Dan Nystedt
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TSMC’s NT$1.5 trillion (US$47.5B) investment on 4 new 1.4nm fabs in a science park near Taichung, central Taiwan, has driven big growth as supply chain partners also invest there, officials say, media report, adding ASML, Tokyo Electron, Hon Precision, MGC Pure Chemicals, KingLai Group, and more, have already invested in new locations or plants in the city. Taichung led Taiwan with over 1,200 new factory registrations last year. $Taiwan Semiconductor(TSM.US) $ASML(ASML.US) $Tokyo Electron(TOELY.US) $8035
Source: Dan Nystedt
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TSMC has suspended new 3nm project starts and raised 3nm prices in an effort to nudge customers to 2nm because the shortage in 3nm capacity is unlikely to soon change and 3nm expansion unlikely to keep up with demand, media report, adding 2nm does NOT cost the feared $30,000/wafer, but is a better deal for high volume products due to stable EUV layers (more than 3nm but not as bad as feared due to Atomic Layer Deposition, materials). TSMC’s 3nm capacity is fully booked by AI giants (GPU and ASIC), and smartphone chip makers. The article cites unnamed industry sources. $Taiwan Semiconductor(TSM.US) $ASML(ASML.US) #ASMInternational $Applied Materials(AMAT.US) $Tokyo Electron(TOELY.US) #Semiconductors #semiconductor
Source: Dan Nystedt
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SK Hynix plans to open the 1st of four facilities at its Yongin campus in South Korea in March next year, 2-months earlier than the planned, as it accelerates DRAM capacity expansion amid heavy demand, media report, citing unnamed sources. Equipment move-in will begin in April. The 2nd and 3rd facilities in Yongin will also open in 2027, earlier than the prior plan of 2028 and 2029, respectively. $ASML(ASML.US) $Applied Materials(AMAT.US) $Tokyo Electron(TOELY.US) $Lam Research(LRCX.US) $KLA(KLAC.US) $Micron Tech(MU.US) $HXSCL $SSNLF #SKhynix #Samsung
Source: Dan Nystedt
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TSMC plans to rapidly build out 2nm capacity to 140,000 wafers-per-month (wpm) by end-2026 due to strong AI-related demand, media report, up from 100,000wpm expected and 35,000wpm at end-2025. TSMC will also expand 3nm capacity to 160,000wpm this year as it is in short supply. $Taiwan Semiconductor(TSM.US) $ASML(ASML.US) $Applied Materials(AMAT.US) $Tokyo Electron(TOELY.US) $Lam Research(LRCX.US) $KLA(KLAC.US) #semiconductors #semiconductor
Source: Dan Nystedt
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TSMC 2nm mass production in Kaohsiung (south), Taiwan was lauded by the city’s mayor as a result of years of hard work by city officials – even during Covid – to win TSMC’s investment and ensure a smooth build out, media report, adding TSMC’s initial operations are expected to see over NT$150 billion (US$4.8B) in annual output. 1/2 $Taiwan Semiconductor(TSM.US) $Tokyo Electron(TOELY.US) $Applied Materials(AMAT.US) $ASML(ASML.US) $KLA(KLAC.US) $Lam Research(LRCX.US) #Semiconductors
Source: Dan Nystedt
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TSMC will likely begin booking 2nm revenue in the 3rd quarter of 2026, based on how previous-gen 3nm revenue ramped up, media report, citing unnamed industry sources. Higher prices for 2nm has not hurt demand, as the AI boom is expected to see 2nm revenue beat TSMC’s successful 5nm and 3nm ramp ups to become the most successful process in TSMC history. 1/2 $Taiwan Semiconductor(TSM.US) $ASML(ASML.US) $Applied Materials(AMAT.US) $KLA(KLAC.US) $Lam Research(LRCX.US) $Tokyo Electron(TOELY.US) #semiconductors
Source: Dan Nystedt
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TSMC is seen raising 2026 spending on new plants and equipment to US$42-$45 billion, media report, citing investment analysts, up from $40-$42 billion this year. Such capex spending would mark all-time highs and reflects the frenetic pace TSMC has had to build out capacity to meet strong AI-related demand. $Taiwan Semiconductor(TSM.US) $ASML(ASML.US) $Applied Materials(AMAT.US) $Lam Research(LRCX.US) $KLA(KLAC.US) $Tokyo Electron(TOELY.US) #Semiconductors #semiconductor
Source: Dan Nystedt
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SEMI: Global semiconductor equipment sales will hit US$145 billion in 2026, after rising 13.7% to a record high $133 B this year, driven by AI-related spending in leading-edge logic and memory chip manufacturing, as well as advanced semiconductor packaging. Growth is seen hitting $156 B in 2027 as the global fab buildout continues.
Fab equipment (front end) seen +11% to $115.7 B this year, beating prior forecast of $110.8 B. Assembly/packaging/test equipment (back end) in 2025: Testing: seen +48.1% to $11.2 BAssembly/packaging: seen +19.6% to $6.4 B$ASML(ASML.US) $Applied Materials(AMAT.US) $Tokyo Electron(TOELY.US) $Lam Research(LRCX.US) $KLA(KLAC.US) $MKS(MKSI.US) $Veeco Instruments(VECO.US) $Axcelis(ACLS.US) $Teradyne(TER.US) $Onto Innovation(ONTO.US) $Camtek(CAMT.US)Source: Dan Nystedt
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TSMC mass production of 2nm chips heralds a new era of chip manufacturing marked by a fundamental change in basic transistor structure to new GAA transistors – from FinFETs – that requires an upgrade of the entire manufacturing ecosystem, media report, from clean rooms with stricter specs to new production equipment, finer materials (ex. wafers that are even flatter), more complex multi-patterning, more complex bonding, etc., and is a key reason for the higher cost of a 2nm fab and why TSMC’s 2026 capex will rise to around US$50 billion. $Taiwan Semiconductor(TSM.US) $Tokyo Electron(TOELY.US) $ASML(ASML.US) $Applied Materials(AMAT.US) $Lam Research(LRCX.US) $KLA(KLAC.US) $Apple(AAPL.US) #semiconductors
Source: Dan Nystedt
