1、7T2se3r0Ot6kwoPa7T2se3r0Ot6kwoPaDistributed on:05/09/2025 18:34:16 GMTDistributed on:05/09/2025 18:34:16 GMT5 September 2025After dozens of meetings,we take stock of our European hardware coverageIn the last 2 weeks,we have met dozens of global semiconductor companies to check the pulse of the indus

2、try.This week,we hosted twenty European semis and IT hardware names at our European TMT conference,including ASML,ASMI,Infineon,VAT and Besi.Last week,we also hosted 25 global semiconductor companies at our Technology conference in Dana Point including European names such as ASML,ST Micro,Infineon,B

3、esi and SUSS.Key themes emerged,which have relevance for the whole industry especially in semicaps and analog semis.Semicaps:2026 complicated by China normalization;Intel more under-pinnedAfter Applied Materials sounded the alarm on China in mid-August,we noted that semiconductor equipment companies

4、 are leaning to 2026 being another normalization year for Chinese demand.This means that a scenario of WFE spend from Chinese firms being down in the double-digits yoy is now more feasible.However,it is clear that SMIC and HH Grace will become much more established scale players at 28-90nm serving a

5、 much larger localized market,so this demand is not likely to fall off a cliff,even if there has been clear stockpiling over the last 3-4 years.We also believe the risk around Naura and Amec replacing Western players in etch and deposition is also starting to play out even if that will take time(up

6、to 50%of the portfolio is already at risk of replacement),which will at least allow VAT Group to hedge its exposure to Applied,TEL and Lam.Such replacement risk to the likes of ASML and KLA is much,much lower.As for Intel,recent newsflow in the form of the Softbank injection and the US government ta