Taiwan’s July Revenue Beats Expectations, Led by Technology and Memory-Chip Stocks
Revenue at Taiwan-listed companies that had reported—representing about 50% of the market—rose 55% year over year in July, accelerating from 52% growth in June.
Revenue at Taiwan-listed companies that had reported—representing about 50% of the market—rose 55% year over year in July, accelerating from 52% growth in June. July sales had already reached 36% of the consensus forecast for the third quarter, above the historical average of 32%.
Information technology revenue increased 62% year over year in July. The strongest-performing subsectors were other semiconductors, up 67%; foundries, up 64%; and hardware storage, up 61%.
Nanya Technology’s (2408) July revenue surged 720% year over year, while Phison Electronics (8299) rose 378% and Winbond Electronics (2344) increased 292%.
Against a backdrop of a roughly 3%-9% gain in the broader TPEx, technology stocks excluding Taiwan Semiconductor Manufacturing Co. rose about 10%, supported by buying from foreign investors and local institutions. TSMC and financial stocks, however, acted as a drag of about 2%.
The July sales figures beat expectations, but export data fell short of expectations, creating a divergence between domestic and external demand.
Goldman Sachs’ conclusion is that Taiwan’s semiconductor and memory supply chain is performing broadly above expectations. It says weak export data point to risks in external demand and that investors should focus on structurally strong areas amid the divergence between domestic and external demand.
The note identifies Nanya Technology (2408.TW), Phison Electronics (8299.TW), Winbond Electronics (2344.TW) and Quanta Computer (2382.TW), among others in the memory and hardware supply chain, as beneficiaries. It also identifies Taiwan’s semiconductor and hardware-storage sectors as beneficiaries. Goldman Sachs says the market has already partially reflected the July sales outperformance, but third-quarter overall attainment remains on an upward trajectory and has not yet been fully priced in; it says continued earnings confirmation will determine the scope for further gains.
Catalysts cited in the note include: more companies reporting revenue data in July and August, which will show whether third-quarter attainment can continue to exceed the historical average; a potential improvement in export data in August and September that could ease concerns about external demand; TSMC’s August revenue and progress on artificial-intelligence-related orders; and spot-price trends for DRAM and NAND memory chips.
Information technology revenue increased 62% year over year in July. The strongest-performing subsectors were other semiconductors, up 67%; foundries, up 64%; and hardware storage, up 61%.
Nanya Technology’s (2408) July revenue surged 720% year over year, while Phison Electronics (8299) rose 378% and Winbond Electronics (2344) increased 292%.
Against a backdrop of a roughly 3%-9% gain in the broader TPEx, technology stocks excluding Taiwan Semiconductor Manufacturing Co. rose about 10%, supported by buying from foreign investors and local institutions. TSMC and financial stocks, however, acted as a drag of about 2%.
The July sales figures beat expectations, but export data fell short of expectations, creating a divergence between domestic and external demand.
Goldman Sachs’ conclusion is that Taiwan’s semiconductor and memory supply chain is performing broadly above expectations. It says weak export data point to risks in external demand and that investors should focus on structurally strong areas amid the divergence between domestic and external demand.
The note identifies Nanya Technology (2408.TW), Phison Electronics (8299.TW), Winbond Electronics (2344.TW) and Quanta Computer (2382.TW), among others in the memory and hardware supply chain, as beneficiaries. It also identifies Taiwan’s semiconductor and hardware-storage sectors as beneficiaries. Goldman Sachs says the market has already partially reflected the July sales outperformance, but third-quarter overall attainment remains on an upward trajectory and has not yet been fully priced in; it says continued earnings confirmation will determine the scope for further gains.
Catalysts cited in the note include: more companies reporting revenue data in July and August, which will show whether third-quarter attainment can continue to exceed the historical average; a potential improvement in export data in August and September that could ease concerns about external demand; TSMC’s August revenue and progress on artificial-intelligence-related orders; and spot-price trends for DRAM and NAND memory chips.