Advanced nodes revenue fell 30% to historical lows, yet operating margin expanded to 26%.
Thesis: Onto demonstrated pricing power in the worst possible mix environment. Their highest margin segment (advanced nodes) collapsed to 8% of revenue, yet they expanded operating margins to 26%. This proves the AI packaging cycle is not just volume—it's high-value structural capital intensity. When legacy nodes recover, this becomes a margin super-cycle.
Verdict: LONG — Conviction: HIGH
Catalyst: Gate-all-around pilot line orders converting to volume ramp in early 2025, or the third HBM player accelerating orders.
Key Risk: Customer digestion in 2H24 creating an 'air pocket' before the 2025 ramp, as admitted by the CEO.
The Tell: Mike Plisinski admitted 'The second-half expansion is a question right now' regarding customer capacity adds. While framed as visibility, it signals a potential air pocket between the initial AI sprint and the 2025 volume ramp.
Friction Level: MODERATE_FRICTION — Bears see a cyclical peak in packaging masking a broken front-end. Bulls see structural leverage where packaging density replaces wafer volume as the driver.
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