It’s about the “core” city! U.S. stock earnings season kicks off, two earnings reports today and tomorrow may “set the tone” for market sentiment in advance

It’s about the “core” city! U.S. stock earnings season kicks off, two earnings reports today and tomorrow may “set the tone” for market sentiment in advance.

With Goldman Sachs and JPMorgan Chase releasing their earnings reports on Tuesday, the second earnings season for U.S. stocks has officially kicked off.

Many investment banks on Wall Street believe that this week's second-quarter financial reports from ASML and TSMC will be regarded as a "wind vane" for the entire semiconductor and semiconductor equipment industry. ASML will release its earnings report on Wednesday local time, while TSMC will release its earnings report on Thursday.

On Tuesday Eastern Time, US diversified financial services company B. Riley released a report stating that the performance and guidance of the two companies, TSMC and ASML, have significant signal significance for the broader chip supply chain.

Riley's core argument is that the acceleration of global ultra-large-scale AI capital expenditures has exceeded its own expectations, and the financial reports of semiconductor equipment supplier ASML and semiconductor foundry giant TSMC will provide clues to the AI capital expenditure trends of global technology giants.

Pepperstone strategist Dilin Wu said that the financial reports of ASML and TSMC will have an impact on the recent market situation. TSMC’s capital expenditure plan is one of the data that attracts market attention in Nvidia’s supply chain, and ASML’s production capacity planning provides important clues to the industry’s expansion speed.

“The current market expectations for the performance of the two companies have risen to a high level.” TSMC expected to raise revenue Currently, in the fiscal year 2026 guidance of major U.S. hyperscale companies, the total scale of AI capital expenditures has jumped to approximately US$695 billion to US$725 billion, a level originally set by B.

Riley for fiscal year 2027. Therefore, B Riley's total estimate of global AI capital expenditure in 2026 has risen to approximately US$880 billion, and may even exceed US$1.02 trillion in 2027. The surge in AI spending will directly affect TSMC’s upcoming performance guidance. B.

Riley believes that if TSMC classifies CPUs into its high-performance computing AI accelerator category, revenue guidance for 2026 is expected to be raised by 500 basis points, achieving a year-on-year growth of 35%.

Citi analysts also made similar predictions in their forward-looking report: We believe that given the continued strong demand for advanced processes and increasingly clear long-term prospects, TSMC is more likely to further increase its 2026 and long-term revenue compound growth rate targets.

The catalyst for this potential reclassification is the rising demand for CPU scheduling from agent-based AI. B. Riley pointed out that this will bring the total accessible market (TAM) of x86 and ARM servers to AMD's estimated US$120 billion in 2030, with a compound annual growth rate of 35%.

Nvidia's Vera CPU alone is expected to bring about $20 billion in revenue visibility in fiscal 2026, the company added. "If TSMC expands its HPC AI accelerator product line into the CPU field, we estimate that fiscal 2026 revenue guidance may be raised by 500 basis points, reaching 35% year-on-year growth." analysts wrote.

Semiconductor equipment faces longer-term support In terms of semiconductor equipment represented by ASML, B.

Riley believes that the industry-wide wafer manufacturing equipment expenditure in fiscal year 2026 has significantly exceeded the level of more than 140 billion US dollars mentioned by Kelei Semiconductor (KLAC.US) and Lam Research (Lam Research), and predicts that fiscal year 2027 may approach or exceed 170 billion US dollars.

Riley also noted that the semiconductor equipment market is facing a long-term but potentially significant positive trend.

According to recent guidance from Micron Semiconductor, capital expenditures in the memory field in fiscal year 2026 are still mainly concentrated on facility construction, and the proportion of tool expenditures is not expected to accelerate significantly until fiscal year 2027.

The company believes that peak demand for memory tools is "probably still several years away," meaning equipment vendors have more room to operate than currently widely expected. As earnings season kicks off this week, global macro and geopolitical influences are exposing markets to more volatility. Despite this turbulence, B.

Riley believes that this market correction should be viewed more as an entry opportunity than a turning point in fundamentals.

"Overall, while risks remain, continued strong demand trends are expected to further drive consensus earnings per share (EPS) higher in fiscal 2026-2028, providing upside catalyst potential for stocks that have been weak recently," the company wrote. (

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