Citigroup: AI demand drives semiconductor recovery in data centers, networks, and automotive fields to offset cyclical weakness.

Citibank released a research report stating that ten mainland Chinese and Hong Kong technology companies participated in Citibank's 2026 Pan-Asia Conference held in Singapore last week. Among the companies of interest at the meeting, Citibank gave buy ratings to ASMPT (00522), Luxshare Precision Industry (002475.SZ), Lens Technology (06613), Hawei Technology (603501.SH), and CONANT OPTICAL (02276). The main points of the conference are as follows: (1) for the iOS supply chain, memory/foreign exchange headwinds are controllable, but pressure is expected in the second quarter of 2026; (2) the upcoming launch of foldable smartphones will drive major hardware specification upgrades; (3) demand for AI edge devices is gaining momentum, benefiting major manufacturers; (4) AI smart glasses with displays are improving visibility; (5) AI demand is driving a semiconductor recovery in data centers, networks, and automotive sectors, offsetting cyclical weakness; (6) strong growth in data center hardware demand is leading suppliers to increase capacity for high-margin products; (7) AI software and IT services are rapidly growing, shifting towards scalable, token-based monetization models to improve profit margins.