GMT EIGHT - Financial Report

Customer trading volume and commission revenue surged. Interactive Brokers Group, Inc. Class AQ4 (IBKR.US) revenue and profits both exceeded expectations.

Automated global electronic broker Interactive Brokers Group, Inc. Class A (IBKR.US) announced its fourth quarter financial performance after the market closed on January 21st Eastern Time. The data shows that the revenue for the quarter was $1.387 billion, exceeding analysts' average expectations of $1.29 billion. Adjusted earnings per share were $2.03, surpassing analysts' expectations of $1.73 by $0.30. Following the announcement, as of the time of writing, the company rose by 3.32% in after-hours trading on Tuesday. Driven by an increase in customer trading volume, commission income increased by 37% year-over-year to $477 million. Customer options and stock trading volume surged by 32% and 65% respectively, while futures trading volume decreased by 3%. Driven by an increase in average customer margin loans and customer credit balances, net interest income grew by 11% to $807 million. In the fourth quarter, the company's customer accounts increased by 30% year-over-year to 3.34 million, customer equity assets increased by 33% to $568.2 billion. Customer margin loans increased by 45% to $64.2 billion. Daily average revenue trades (DARTs) increased by a total of 61% to 3.12 million trades, enhancing trading activity and profitability. The company's Q4 other fees and services revenue increased by $26 million, or 47%, to $81 million, driven mainly by an increase in risk exposure expenses of $14 million and an increase in payment for order flow obligations mandated by exchanges of $4 million. Execution, clearing, and distribution expenses increased by 15% to $115 million, primarily due to higher rates by the U.S. Securities and Exchange Commission (SEC), newly introduced Cat fees by the Financial Industry Regulatory Authority (FINRA), and an increase in customer options and stock trading volume. The Board of Directors of Interactive Brokers Group, Inc. Class A announced that it will distribute a quarterly cash dividend of $0.25 per share on March 14, 2025. The company's adjusted pre-tax profit margin increased to 76%, higher than the 72% from the same period the previous year.

4 h ago

American Airlines Group Inc. continues to deliver good news! United Airlines Holdings, Inc. (UAL.US) exceeds expectations in Q4 performance, with sustained high travel demand.

United Airlines Holdings, Inc. (UAL.US) announced its fourth-quarter performance for 2024. The data shows that the company's Q4 revenue increased by 8% year-on-year to $14.7 billion, surpassing market expectations, mainly due to a 20% growth in sales of basic economy seats and a 10% increase in premium ticket prices; adjusted earnings per share rose to $3.26, exceeding market expectations of $3.05. United Airlines Holdings, Inc. expects profits in the first quarter of 2025 to significantly exceed Wall Street's expectations, as the company has fully leveraged the exceptionally strong demand for high-end and international travel. United Airlines Holdings, Inc. expects adjusted earnings per share for the first quarter to be between $0.75 and $1.25, compared to analysts' previous average expectation of $0.56. The company also expects full-year adjusted earnings per share to be between $11.50 and $13.50, compared to analysts' average estimate of $12.84. This optimistic outlook highlights that major U.S. airlines are forecasting demand to surpass historical normal levels during what is typically the weakest period of the aviation industry - after the December holidays and back-to-school season. United Airlines Holdings, Inc. last achieved a profit in the first quarter in 2019, and this forecast suggests that Americans are continuing to travel even in winter, across the Atlantic and to China. Bank of America Corp's data shows that such flights account for about 20% of United Airlines Holdings, Inc.'s revenue. United Airlines Holdings, Inc. CEO Scott Kirby stated in a release that travel demand is "continuing to ramp up." This year, the airline plans to operate 800 flights per day to 147 international destinations, compared to 700 flights in 2024. American Airlines Group Inc. has also benefited from rising ticket prices as U.S. low-cost airlines cut unprofitable routes, which had depressed ticket prices last summer. Competitor Delta Air Lines, Inc. (DAL.US) has also made similarly optimistic forecasts for the first quarter, stating that the balance between industry flight schedules and travel demand is becoming healthier, a trend that is expected to continue into spring. After Tuesday's stock market close, United Airlines Holdings, Inc. saw its stock price rise by 3.8%, and the U.S. airline sector also saw gains, with American Airlines Group Inc. (AAL.US) and Delta Air Lines, Inc. rising by nearly 2%. United Airlines Holdings, Inc. rose by 135% last year, compared to a 23% increase in the S&P 500 index.

4 h ago

Netflix (NFLX.US) Q4 earnings report beats expectations, paid membership surpasses 300 million.

Netflix (NFLX.US) delivered a strong performance in its fourth-quarter earnings report released on Tuesday, exceeding Wall Street's expectations for revenue and profit, leading to a more than 13% surge in its stock price after hours. Netflix announced that its paid membership surpassed 300 million in the fourth quarter, with a record-breaking addition of 19 million new users. The company attributed this growth to high-quality content, product improvements, and the usual seasonal uptick in the fourth quarter. Additionally, including "additional member accounts," Netflix estimates its global audience has exceeded 700 million. Netflix's performance for the quarter ending December 31st exceeded market expectations, with earnings per share of $4.27, higher than the expected $4.20; revenue reaching $10.25 billion, surpassing the expected $10.11 billion; and paid membership reaching 301.63 million, exceeding the expected 290.9 million. The company's net income surged from $938 million ($2.11 per share) in the same period last year to $1.87 billion ($4.27 per share), doubling year over year. Fourth-quarter revenue grew by 16% year over year, reaching $10.25 billion, higher than market expectations. Netflix raised its full-year revenue forecast for 2025 to $43.5 billion to $44.5 billion, approximately $500 million higher than previously predicted. This reflects the company's improving core business and the continued impact of its better-than-expected performance in the fourth quarter. The fourth quarter marks the last time Netflix will report paid membership numbers quarterly. In the future, Netflix will switch to releasing a "user engagement report" semi-annually, coinciding with the second and fourth-quarter earnings reports. Netflix highlighted the success of its fourth-quarter content, including the release of the popular series "Squid Game" Season 2 and record-breaking live sports events like the boxing match between Jake Paul and Mike Tyson and the NFL game on Christmas day. Looking ahead to 2025, Netflix plans to further optimize its core business, release more series and films, improve user product experience, and continue to develop its advertising business. Additionally, the company will explore opportunities in live events and gaming. In 2025, Netflix will see the return of popular series such as "Stranger Things" and "Wednesday," which are expected to attract more users and drive growth.

6 h ago

Charles Schwab Corp(SCHW.US)Q4 earnings exceed expectations, core net new assets of $115 billion.

Charles Schwab Corp (SCHW.US) has announced better-than-expected fourth-quarter performance, with the retail brokerage business continuing to attract record-breaking new inflows of funds. The data shows that the company's Q4 revenue increased by 20% year-over-year to $5.3 billion, surpassing the market's expectation of $5.2 billion. Adjusted earnings per share were $1.01, also exceeding analysts' expectations. Annual revenue grew by 4%, surpassing the company's growth guidance range of 3% to 3.5% provided in December last year. Rick Wurster, the new CEO who took office at the beginning of the year, said, "Record net inflows into our managed investment solutions helped boost fourth-quarter revenues." Following the release of the financial report, the company's stock surged over 6% in pre-market trading on Tuesday. Charles Schwab Corp stated that 2024 is a "transitional" year for the company after experiencing turbulence in the regional banking industry in 2023. Wurster and the new CFO Mike Verdeschi were appointed to restore stability to the company, and so far, Charles Schwab Corp's performance has continued to improve. The company reported total client assets of $10.1 trillion, surpassing $10 trillion for the first time in November last year, slightly below analysts' expectations of $10.17 trillion. Core net new assets in the fourth quarter were approximately $115 billion, with an annual increase of around $370 billion. CEO Rick Wurster stated that the 20% year-over-year growth in net new assets reflects the company's continued progress following the acquisition of TD Ameritrade in 2020. Charles Schwab Corp also noted an 11% increase in trading activity compared to the previous quarter, driven by increased customer engagement post the presidential election. Additionally, Charles Schwab Corp plans to add a dozen new branches this year and relocate some of its existing 400+ branches to be closer to major streets and communities with higher foot traffic.

21/01/2025

3M (MMM.US) reported better-than-expected performance in Q4. The financial guidance for 2025 is optimistic.

Industrial giant 3M Company (MMM.US) announced its fourth-quarter and full-year performance for 2024 on Tuesday, and also released financial guidance for 2025. The financial report shows that 3M's Q4 earnings per share were $1.33, an increase of 17% from the same period last year. Adjusted earnings per share were $1.68, higher than the FactSet forecast of $1.66. Sales increased by 0.1% to $6.01 billion, higher than FactSet's forecast of $5.783 billion. Adjusted sales were $5.8 billion, an increase of 2.2% year-on-year, and adjusted organic sales increased by 2.1%. For the full year, 3M's GAAP earnings per share for 2024 were $7.26, with an operating profit margin of 19.6%. Adjusted earnings per share were $7.30, a 21% increase year-on-year. Total sales for the year were $24.6 billion, a decrease of 0.1% year-on-year, and organic sales decreased by 0.2%. Adjusted sales were $23.6 billion, an increase of 1.3% year-on-year, and adjusted organic sales increased by 1.2%. Looking ahead to 2025, 3M expects adjusted earnings per share to be between $7.60 and $7.90, while FactSet's expectation is $7.78. The company forecasts sales growth of 0.5% to 1.5%, while FactSet's consensus is a 2.3% decrease in sales. By region, 3M expects sales in the United States and EMEA (Europe, Middle East, and Africa) to slightly increase, and sales in the Chinese market to grow at a moderate single-digit rate, although slower than in 2024. 3M is also closely monitoring market dynamics. For example, there has been a slight decrease in demand for automotive manufacturing, while demand for consumer electronics products has seen low to moderate single-digit growth. Additionally, consumer discretionary spending remains weak. By business segment, the Safety and Industrial sector saw sales increase by 2.4% to $2.703 billion in the fourth quarter, exceeding FactSet's forecast of $2.652 billion. Transportation and Electronics sales increased by 2% to $1.792 billion, slightly below FactSet's forecast of $1.794 billion. Consumer sector sales grew by 1.2% to $1.229 billion. It is worth noting that 2024 was a pivotal year for 3M Company's transformation. The company resolved issues with "forever chemicals" in drinking water and Combat Arms earplugs through legal settlements, and spun off its healthcare business into Solventum Corp. In addition, new CEO William Brown took over from the six-year tenure of Mike Roman, driving the company's transition from a geographical business segment structure to a global business segment structure, and focusing on supply chain activities. Brown is focused on research and development to promote new product development, and continues to invest in high-growth markets such as electric vehicles, data centers, and semiconductors. The number of new product releases increased by 32% for the year, exceeding the company's expectations. Brown also adjusted 3M's remote work policy, requiring supervisor-level employees and above to work in the office on Tuesdays through Thursdays, defined as "collaboration days." As of the time of writing, 3M's stock price has risen by over 4% in pre-market trading. In the past 12 months, 3M's stock price has increased by 56.5%, while the S&P 500 index has risen by 23.9%.

21/01/2025

United Microelectronics Corp. Sponsored ADR (UMC.US) Q4 revenue increased by 9.9% year-on-year, and wafer shipments slightly exceeded expectations.

On January 21 (Tuesday) before the US stock market opened, United Microelectronics Corp. Sponsored ADR (UMC.US) announced its performance for the fourth quarter of 2024. The financial report shows that United Microelectronics Corp. Sponsored ADR's Q4 revenue was $1.84 billion, a year-on-year increase of 9.9%, which was $10 million lower than market expectations; net profit was $259 million, a year-on-year decrease of 35.6%; diluted earnings per ADS was $0.10, below market expectations of $0.15. United Microelectronics Corp. Sponsored ADR's wafer shipments in the fourth quarter increased by 1.5% to 909,000 pieces, with a quarterly capacity of 1.28 million, and the overall utilization rate in the fourth quarter slightly decreased to 70%. The average selling price (ASP) remained unchanged in the fourth quarter. Revenue contribution from 22/28nm slightly decreased to 34% of wafer revenue, while revenue contribution from 40nm increased to 16%. Jason Wang, Co-President of United Microelectronics Corp. Sponsored ADR, said: "Our performance in the fourth quarter met expectations, with wafer shipments and utilization rate slightly exceeding expectations. For the full year of 2024, revenue increased by 4.4% year-on-year, reflecting steady improvement in demand in the communication, consumer, and computer sectors. Our 22/28nm product portfolio remains the largest contributor, with revenue growth of 15% in 2024." In the fourth quarter, communication business revenue accounted for 39% of United Microelectronics Corp. Sponsored ADR's revenue, computer application business revenue remained at 13%, consumer application business revenue accounted for 29%, and revenue from other businesses increased to 19%. As of the end of the quarter, United Microelectronics Corp. Sponsored ADR's cash and cash equivalents increased to NT$105 billion, and inventory turnover days decreased by 5 days to 80 days. Performance Guidance United Microelectronics Corp. Sponsored ADR expects wafer shipments to remain stable in the first quarter of 2025; the average selling price in US dollars will decline by a mid-single-digit percentage.

21/01/2025

Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR (TSM.US) FY4Q24 Performance Meeting Summary: Mild growth expected in PCs and smartphones this year.

In recent days, Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR (TSM.US) held a performance meeting for FY4Q24. Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR pointed out at the meeting that this year is expected to see moderate growth in PCs and smartphones. At the same time, it is important to note that much of the demand is being driven by AI, which is also the reason why the company expects a future 5-year CAGR of 20%. Smartphones are incorporating more AI functions, the semiconductor content is increasing, the replacement cycle is expected to shorten, and more advanced processes are needed in order to fit more functions into such a small area. Regarding the AI outlook for 2025/26, Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR stated that the company expects a mid 40% 5-year CAGR, which can be used as a basis for forecasting. Of course, there may be individual years with higher or lower growth rates. Discussing 2026 at this point is a bit premature. In terms of progress on the Arizona Phase 2, Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR revealed that one factory has already entered mass production, the second factory has completed its construction, is currently installing equipment, and the third factory is expected to start soon. In terms of pricing, the company's global layout provides incremental value to customers, so pricing will also be higher. Q&A: Q: Will the US factories produce more advanced processes? A: The company hopes to strengthen the technology of the US factories as well, but the technical challenges are quite significant. During the climbing phase, factories must be close to the research and development department, so Taiwan will be the manufacturing base for cutting-edge processes, regardless of whether Taiwan's relevant departments open up technology exports. Q: What changes are there in the company's manufacturing strategy in Taiwan and other locations outside of Taiwan? A: The company's overseas expansion is based on customer needs and also requires support from local governments. The company ensures open communication with both the current government and the next government, and cannot provide further details beyond that. Additionally, the trends of US IDM customers and the company's strategy are not directly related, but the related business of these IDM customers is important to the company. Q: Is it possible for the gross profit margin to exceed 60% in this current upcycle? What is the dilution situation of the gross profit margin for the US factories now? A: There are up to 6 factors affecting the gross profit margin. For example, if the utilization rate is good in this upcycle, there is a chance of exceeding 60%. The costs of the US factories are relatively high, including several factors: (1) the scale is still relatively small; (2) the supply chain costs are high; (3) the ecosystem is still in the early stages. In the next 5 years, overseas wafer factories will dilute the gross profit margin by 2%-3% each year. Q: Does this mean that the early gross profit margin of overseas factories will be around 10%? A: Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR will not establish a factory based on this gross profit margin. Q: What are the prospects for PCs and smartphones this year? A: PCs and smartphones are expected to see moderate growth this year. It is important to note that much of the demand is being driven by AI, which is also the reason why the company expects a future 5-year CAGR of 20%. Smartphones are incorporating more AI functions, the semiconductor content is increasing, the replacement cycle is expected to shorten, and more advanced processes are needed in order to fit more functions into such a small area. Q: Can it be assumed that these AI terminals will use 2nm technology next year or in the second half of the year? A: Advanced processes will be used. Q: When can we expect to see revenue related to HBM in the financial statements? A: It may take another half year to see mass production, but this will contribute significantly to Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR's revenue. Q: How will the US restrictions on mainland Chinese AI chip companies this week affect the company? Will it also affect chip companies for mining? A: The company is applying for licenses for related customers, such as automotive customers, who are not in the AI data center industry chain. The company is confident in helping them obtain licenses, as well as for mining companies. Q: What are the prospects for CPO? A: First, the company will not comment on specific products of specific customers. The company is conducting research on silicon light and CPO, and is making good progress. However, in terms of mass production, it is unlikely to happen this year and will take 1 to 1.5 years to reach that stage. Nevertheless, the initial results are positive and customers are satisfied. Q: Progress on the Arizona Phase 2? Pricing policy in Arizona? A: (1) One factory has entered mass production, the second factory has completed its construction, is installing equipment, and the third factory is expected to start soon. (2) The company's global layout provides incremental value to customers, so pricing will be higher. Q: Broadcom Inc. mentioned ASIC's SAM, how does this compare with the company's expectations? A: The company will not comment on specific numbers, but whether it's ASIC or GPU, cooperation with Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR is necessary. For ASIC, customers have expressed significant demand. Q: Why hasn't the company adjusted its long-term gross profit margin? Where are the bottlenecks? A: Six factors affect the gross profit margin, each with different weights. There are two things to continue to monitor in the future: (1) dilution from the expansion of overseas factories; (2) macroeconomic uncertainties. Overall, the company is in a capital-intensive industry and needs a high gross profit margin to sustain investment. A gross profit margin of 53% or higher is an achievable goal. Q: When can we expect to see demand for non-AI applications of cowos? A: This year, AI still...It is the main demand, and even in short supply. Other terminals will depend on the customer's decision, but the company expects that this part of the demand is coming soon. Although specific events cannot be disclosed, it can be revealed that the demand is coming from server CPUs.Q: What methods are there to improve the operational efficiency of overseas factories? A: The company will continue to seek ways to bring the cost structure of US factories in line with that of Taiwan factories. Q: In a dilution of 2%-3%, are variable costs or fixed costs the determining factor? A: Specific data cannot be disclosed, but both are higher than those of Taiwan factories. Q: Market forecast for the whole year? A: Memory may grow this year, HBM may grow faster, but this is not within the company's business scope. Regarding Foundry 2.0, growth of 10% is expected. Q: Can Foundry 2.0 be considered as the market for all semiconductors other than memory? A: Yes. Q: Progress on SOIC and cowos? Can you comment on some of the current market noise? A: The company is working very hard to meet customer demands and there has been no reduction in orders. Again, it is emphasized that the company is diligently increasing production capacity. Q: What is currently the biggest constraint for AI chips, cowos or HBM? A: The company will not evaluate other aspects. Currently, the company's supply is very tight but this is not a bottleneck, and Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR will do its best to meet customer demands. Q: When will SOIC be implemented? What specific end-uses? A: SOIC will be used in AI applications for PCs and other terminals, but it is not yet being implemented. Q: Outlook for AI in 2025 and 2026? A: The company expects a CAGR of about 40% over the next 5 years to use as a basis for forecasting. Of course, there may be individual years with higher or lower growth rates. It's a bit early to discuss 2026. Q: Outlook for edge AI? A: The company sees customers adding more NPUs and moving their technology to the next process. In addition, replacement cycles are accelerating, and silicon content is increasing by more than 5%. Q: Revenue contributions and profit margins from advanced packaging last year? A: Overall, advanced packaging accounts for 8%, expected to be 10% this year. The gross margin has improved but is still lower than the company average. Q: Does the company consider IDM customers to be a long-term drive for performance growth? A: They are good customers, but the company also does not want to signal their dependence on the company. Both parties are partners and hope to establish a long-term cooperation relationship.

20/01/2025

Financial report outlook | Texas Instruments Incorporated (TXN.US) opens the curtain of chip stock financial report season, expected to release signals of analog chip recovery

Focus on analog chips and embedded processing solutions, American chip giant Texas Instruments Incorporated (TXN.US) will announce its fourth-quarter 2024 performance report after the US stock market closes on January 23, Eastern Time. Investors are expecting the chip company to announce better-than-expected performance, setting a good start for the chip company's earnings season, and also hoping the giant will release optimistic signals about the recovery cycle of analog chip demand. Prior to this, analog chip giants Analog Devices, Inc. (ADI.US) and United Microelectronics Corp. Sponsored ADR (UMC.US), which focus on mature processes such as 14nm and 28nm, have released optimistic signals about the recovery of demand for analog chips in two core application areas - automotive chips and industrial chips. Wall Street analysts generally expect Texas Instruments Incorporated to announce earnings per share of $1.19 for the fourth quarter, a 20.1% year-on-year decrease. Total revenue for the fourth quarter is expected to be around $3.86 billion, down 5.4% from the same period last year, indicating a significantly narrower decline compared to the past few quarters. Most analysts believe that Texas Instruments Incorporated's customers are significantly digesting excess inventory. In addition, as generative artificial intelligence gradually integrates with consumer electronics and industrial applications, after several quarters of continuous revenue decline, the timing for the recovery of orders and the revival of demand for analog chips is expected to come in the middle or second half of this year. Texas Instruments Incorporated is one of the world's largest analog chip manufacturers, and most of its chip products perform simple but crucial functions, such as converting power to different voltages in electronic devices. More importantly, analog chips have played an indispensable role in various key modules and systems of electric vehicles in recent years, including power management, battery management, sensor interfaces, audio and video processing, and motor control. With one of the largest customer bases and product ranges among chip manufacturers, Texas Instruments Incorporated's performance and outlook data can serve as a forecast indicator for various industry demands. Most of its chip products are used in industrial and electric vehicle applications. If one of the world's largest analog chip manufacturers, Texas Instruments Incorporated, announces better-than-expected optimistic earnings and outlook, it will also mark the start of the earnings season for US chip giants, or continue to boost the bull market trend of the Philadelphia Semiconductor Index, which has been dubbed the "global chip stock benchmark." Chip giants such as ON Semiconductor Corporation (ON.US), Intel Corporation (INTC.US), ASML Holding NV ADR (ASML.US), KLA Corporation (KLAC.US), Qualcomm (QCOM.US), AMD (AMD.US), and NVIDIA Corporation (NVDA.US) will gradually disclose their latest earnings reports and outlook data from late January to late February. The performance of these chip giants is crucial for the outlook of global chip industry demand and is also critical for the direction of the Nasdaq 100 index in financial markets. Analysts' outlook on Texas Instruments Incorporated's various business segments: In the past 30 days, Wall Street financial institutions have maintained general expectations for Texas Instruments Incorporated's earnings per share this quarter. Before the company announces its earnings, any changes in earnings per share forecasts are crucial. If there are no significant upward revisions or downward revisions, it means analysts have a consistent outlook for the performance, and the stock price tends to fluctuate less after the earnings are announced. These revisions play a key role in predicting potential investor reactions to the company's financial results. Several empirical studies have consistently shown a close relationship between earnings per share forecast trends and short-term stock price changes. Although investors often rely on general earnings per share and revenue estimates to evaluate quarterly business performance, in-depth analysis of analysts' predictions on certain key performance indicators can often provide a more comprehensive understanding of performance. With this perspective in mind, it is time to comprehensively examine the average forecast values of certain key performance indicators that Wall Street analysts routinely monitor and predict for Texas Instruments Incorporated. According to collective analyst judgment, "Other revenue" is estimated to be approximately $213.67 million. This estimate indicates a year-on-year change of +4.2%. Analysts generally expect that "Embedded Processing revenue" will reach $588.98 million. This estimate indicates that the revenue for this business will decrease by 21.7% compared to the same period last year. Analyst evaluations indicate that "Analog Business Revenue" will reach around $3.05 billion, with a forecast indicating a change of -2.2% compared to the same period last year. In terms of core business operating profits for Texas Instruments Incorporated, Wall Street analysts generally predict that "Analog Business fourth-quarter operating profit" will reach approximately $1.15 billion; compared to the current forecast, the company's performance report for the same quarter last year showed $1.28 billion. Collective analyst evaluations show that the estimated "overall operating profit for other businesses" is $3.72 million; compared to the current estimate, the company's operating profit for the same period last year was.Quarterly profit is approximately 58 million US dollars.Analysts expect that the operating profit related to the "embedded processing business" will reach approximately $1.0378 billion; compared to the current forecast data, the profit for the same quarter of the previous year was around $1.95 billion. AI may help Texas Instruments Incorporated enter the long-awaited "analog chip demand recovery cycle" in the market. Many analog chip manufacturers focusing on the industrial and electric vehicle markets, including Texas Instruments Incorporated, have experienced continued poor performance since 2023. Their revenue has been severely affected by customer excess inventory, slowing customer orders, and a sharp shortage of analog chips after the COVID-19 pandemic, leading industrial customers to accelerate inventory hoarding, and more importantly, the sluggish demand for electric vehicles and industrial manufacturing. Under the long-term excess inventory and the macroeconomic environment of high interest rates maintained by the Federal Reserve, demand for the industrial manufacturing sector and global electric vehicles has significantly cooled since 2023, exacerbated by the gradual withdrawal of government subsidies related to global electric vehicles, further weakening demand for electric vehicles. Artificial intelligence (AI) is gradually being integrated into Texas Instruments Incorporated's business focus on the automotive and industrial sectors, driving technological innovation in production and hardware deployment in these two major fields. Since the second half of 2024, it has led to continued demand recovery, while downstream accelerating destocking has constantly helped demand to overcome the "sluggish period." In the electric vehicle sector, AI is not only used for autonomous driving and advanced driver assistance systems (ADAS), but also to optimize production manufacturing and in-vehicle entertainment experiences. In the industrial manufacturing sector, AI is widely used in smart manufacturing, predictive maintenance, and automation control. By integrating AI-related architectures into the hardware system, analog chips can support real-time inference of deep learning models, ensuring that AI systems can respond quickly to changes in the environment. The TDA4VM processing platform, a high-performance chip platform newly designed by Texas Instruments Incorporated for autonomous driving and industrial applications, integrates various processors (including CPUs, DSPs, AI accelerators, etc.), supports various deep learning inference tasks, and can provide real-time data processing through edge computing. This platform can process data from vehicle perception systems, vision systems, radar, and LiDAR. Since 2024, Texas Instruments Incorporated's upgraded DSP chips have begun to be widely used in many electric vehicles and industrial applications, especially in scenarios that require efficient signal processing and low power consumption. By combining deep learning and edge computing, Texas Instruments Incorporated's DSP chips can accelerate the AI inference process, helping to achieve faster responses and decisions. Analog Devices, Inc., the global leader in analog chips, released its financial report at the end of November last year, showing that the demand for analog chips in electric vehicles and industrial end markets, which has been sluggish since the rate hike cycle by the Federal Reserve in 2022, is expected to enter the road to demand recovery. Analog Devices, Inc.'s financial report as of November 2 showed that all terminal application markets, including industrial, automotive, communications, and consumer electronics, showed a month-on-month growth, indicating a major turning point in the demand for analog chips that has been sluggish for several quarters. Among them, Analog Devices, Inc.'s Q4 consumer electronics analog chip revenue unexpectedly increased year-on-year, with an increase of over 30%, reinforcing the logic of the recovery of demand in consumer electronics such as PCs and smartphones. Analog Devices, Inc.'s financial report and relatively optimistic growth expectations for 2025 indicate that the demand for analog chips, especially for electric vehicles, which has been continually sluggish since 2022 and has been hovering at the "bottom," may be about to enter the long-awaited demand recovery phase in the market. Since the second half of 2023, driven by the AI frenzy, global enterprises and government agencies have seen a surge in demand for the NVIDIA Corporation (NVDA.US) AI GPU series products, the dominant AI chip in data center, leading to a sharp increase in demand for server CPUs, enterprise storage chips, and high-performance Ethernet chips, and even a recovery trend in demand for PC and smartphone chips due to the rise of AI large models at the terminal. However, the analog chip industry has consistently shown signals of sluggish demand, and Analog Devices, Inc.'s better-than-expected financial report and performance outlook may indicate a turning point in the fundamentals of analog chips. In addition, United Microelectronics Corp., focusing on mature chip processes such as 14nm and 28nm, announced its operating data in January, achieving revenue of 18.97 billion New Taiwan dollars, an 11.7% year-on-year increase. More importantly, after a significant decline of 20% in total revenue in 2023, United Microelectronics Corp. has resumed its growth trend in 2024. Data shows that from January to December, the total revenue of United Microelectronics Corp. increased by 4.39%, reaching approximately 232.3 billion New Taiwan dollars. Unlike the "chip foundry king" Taiwan Semiconductor Manufacturing Co., Ltd. (TSM. US) focusing on the most advanced chip fabrication processes (such as 5nm, 4nm, and 3nm), United Microelectronics Corp. focuses on mature chip processes.Electronics Corp. Sponsored ADR provides mature process technology ranging from 14nm to 28nm and larger values, focusing on mature process nodes. These chip products based on United Microelectronics Corp. Sponsored ADR's mature nodes are widely used in the communication, consumer electronics, automotive electronics, and industrial sectors, focusing on stable and cost-effective mature nodes to meet the overall demand of traditional industrial sectors and mid-range consumer electronics markets. United Microelectronics Corp. Sponsored ADR's total revenue for 2024 rebounded in the fourth quarter driven by strong orders, indicating a recovery process for mature process chips such as analog chips at 14nm and above.The analyst team of Wall Street financial giant Bank of America Corp (Bank of America) recently stated in a report that by 2025, chip stocks are still likely to be one of the most eye-catching sectors in the US stock market. The contribution to the increase in value is expected to expand from benefiting overall from the "AI chip three giants" and other chip companies that benefit from the AI boom to include analog chips and electric vehicle chip stocks, which have long lagged behind the US stock market and the Philadelphia Semiconductor Index. "Non-AI" chip stocks as targets.

20/01/2025

Financial Report Preview | Analysts optimistic about Netflix (NFLX.US) Q4 advertising subscription boost growth target price raised to $950.

Netflix (NFLX.US) will announce its fourth-quarter earnings after the close on Tuesday. Leading up to this crucial milestone, analysts are mostly bullish on this streaming giant. According to data tracked by Visible Alpha, out of the 19 brokerages covering Netflix, 14 have a "buy" or equivalent rating, 4 have a "hold" rating, and only 1 has a "sell" rating. Overall, the consensus target price for Netflix is around $905, about 6% higher than the stock's closing price on Friday. Wedbush Securities raised its target price for Netflix to $950 this week, citing the company's "nearly insurmountable lead in the streaming market competition." The firm's analysis suggests that Netflix's $6.99 advertising-supported subscription plan effectively limits customer churn, thereby "easing the pressure to acquire new users" and is expected to continue driving revenue growth in the coming years. Meanwhile, both J.P. Morgan and Oppenheimer recently lowered their target prices for Netflix. J.P. Morgan decreased its target price from $1010 to $1000, but still believes that Netflix's ad-supported tier and measures to combat password sharing "will help expand the user base further and drive incremental high-margin revenue." Oppenheimer also lowered its bullish target price this week. Overall, Wall Street is optimistic about Netflix's performance for this quarter, expecting revenue to increase by 15% year-over-year, reaching $10.13 billion. At the same time, it is estimated that profits will grow to $1.84 billion, equivalent to an earnings per share of $4.23. In comparison, profits for the same period last year were $937.8 million, with an EPS of $2.11. It is worth noting that starting from the earnings announcement on Tuesday, Netflix will no longer report quarterly subscriber numbers. Additionally, the stock closed slightly higher at $858 on Friday, with a cumulative increase of about 78% over the past 12 months.

20/01/2025

Financial Report Outlook | Growth in European and American Demand. Alcoa Corporation (AA.US) is expected to achieve a 30% increase in performance in the fourth quarter.

Alcoa Corporation (AA.US) will announce its fourth quarter earnings for 2024 in the early morning of January 23rd (Wednesday after the U.S. stock market closes), with revenue expected to increase compared to the same quarter last year. Market forecast for revenue is $3.4 billion, a 30.1% increase from the same period last year; market expectations for earnings per share are 91 cents, a 262.5% increase from the same period last year. Business Focus Increased demand for aluminum in Europe and North America is expected to benefit Alcoa's aluminum business in the fourth quarter of 2024. Additionally, strong momentum in the construction market and the recovery in the packaging industry may promote sales in the aluminum business. For the fourth quarter, market expectations for third-party aluminum sales are $2 billion, an 18.9% increase from the same period last year. Total aluminum sales are expected to be $1.97 billion, a 16.7% increase from the reported figures of the same period last year. Alcoa's alumina business has benefitted from increased alumina shipments and smelter output. Market expectations for third-party alumina sales are $1.3 billion, a 72.3% increase from the same period last year. Overall alumina sales are expected to be $2.1 billion, a 54.1% increase from the same period last year. Synergies from recent acquisitions are expected to boost revenue. In August 2024, Alcoa Corporation acquired Alumina Limited. This acquisition strengthened its position as a global pure upstream aluminum company. Furthermore, decreases in raw material prices and energy costs in both sectors could support the company's performance. Reductions in production at the Quinana refinery in Australia may put pressure on the company's sales. Due to its extensive geographical presence, the company's operations are affected by global political risks and foreign exchange headwinds. A stronger U.S. dollar may harm Alcoa Corporation's overseas business this quarter. Jefferies Financial Group Inc. rates it as the industry's top pick Alcoa Corporation (AA.US) was previously rated as one of the top picks for mining stocks this year by Jefferies Financial Group Inc. Analyst Christopher La Femina stated, "Although we have become more cautious about the short-term outlook for the industry due to cyclical factors recently and believe that the downside risks are generally expected, we think that it is too late to downgrade our rating now," "Taking into consideration the recent sharp decline, we are inclined to buy into mining and steel producers that we favor."

20/01/2025

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