They explicitly guided for margin compression in H2 2024, yet orders just accelerated sequentially.
Thesis: The Street is obsessing over the inevitable China revenue normalization and missing the structural node shift. Gate-All-Around (GAA) architecture exponentially increases ALD intensity. With GAA orders set to exceed 50% of logic bookings in 2024 and a key customer pulling in 2025 volume, ASM owns the deposition bottleneck for the next decade. The China fade is the noise; the 2nm transition is the signal.
Verdict: LONG — Conviction: HIGH
Catalyst: Q4 2024 order intake, where pilot line conversion to High Volume Manufacturing (HVM) for the lead 2nm customer becomes visible in the backlog.
Key Risk: China revenue 'normalizes' (crashes) faster than the GAA ramp fills the gap, creating a temporary revenue decline in H2 2024.
The Tell: When asked about H2 visibility, CEO Benjamin Loh admitted 'it is too early to provide more specific guidance' yet simultaneously claimed 'confidence' that H2 > H1. He knows the China mix shift is a drag he can't fully size yet, but the GAA order book gives him the cover to stay bullish.
Friction Level: MODERATE_FRICTION — Bears see a revenue air pocket as China normalizes before GAA ramps. Bulls see a seamless baton pass driven by structural ALD intensity increases at 2nm.
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