WanLian Security: Google Gemini integrated into AI phones, DRAM industry revenue expected to continue growing
WanLian Security pointed out that Google will integrate its Gemini into AI smartphones and other hardware, driving revenue growth in the DRAM industry. It is expected that the overall revenue of the DRAM industry in the second quarter of 2024 will reach $22.9 billion, with a quarterly increase of 24.8%. At the same time, AIPC's shipments in the second quarter of 2024 were 8.8 million units, accounting for 14% of the total PC shipments. Under this wave of AI trends, structured investment opportunities will emerge in areas such as PCB and AI terminals
According to the Wise Finance APP, WanLian Security published a research report stating that at the 9th Made by Google event, AI became the key theme of Google's (GOOGL.US) hardware lineup, with Gemini seamlessly integrated into various hardware such as foldable phones, smartwatches, and TWS earphones. In Q2 2024, AIPC shipped 8.8 million units, accounting for 14% of the total PC shipments for the quarter. With the gradual advancement of AIPC planning by major processor suppliers, it is expected that the supply and adoption rate of AIPC will significantly increase in the second half of 2024 and beyond. Benefiting from the expansion of mainstream product shipments driving revenue growth for most industry players, the overall DRAM industry revenue in the second quarter of 2024 reached $22.9 billion, a quarterly increase of 24.8%, with industry revenue expected to continue growing.
From August 12th to August 18th, 2024, the Shanghai and Shenzhen 300 Index rose by 0.42%, the Shenwan Electronic Index rose by 0.66%, ranking 7th among the 31 Shenwan first-level industries, outperforming the Shanghai and Shenzhen 300 Index by 0.24 percentage points. Seize the dual opportunities of algorithm construction and terminal innovation under the AI wave, and focus on structured investment opportunities in areas such as PCB, AI terminals, HBM, advanced packaging, storage chips, and panels.
Industry Dynamics: (1) Advanced Packaging: On August 12th, Advanced Semiconductor Engineering announced that its subsidiary's board of directors approved a capital injection of NT$5.263 billion to purchase factory buildings to meet the company's future expansion needs for advanced packaging capacity. (2) AIPC: In the second quarter of 2024, AIPC shipped 8.8 million units. These devices include desktops and laptops equipped with chipsets or modules dedicated to AI workloads, such as NPUs. AIPC shipments accounted for 14% of the total PC shipments for the quarter. Currently, with the gradual advancement of AIPC planning by major processor suppliers, it is expected that the supply and adoption rate of AIPC will significantly increase in the second half of 2024 and beyond. (3) AI Phones: On August 14th, at the 9th Made by Google event, AI became the key theme of Google's hardware lineup, with Gemini seamlessly integrated into various hardware such as foldable phones, smartwatches, and TWS earphones. (4) Storage: Benefiting from the expansion of mainstream product shipments driving revenue growth for most industry players, the overall DRAM industry revenue in the second quarter of 2024 reached $22.9 billion, a quarterly increase of 24.8%. In terms of prices, contract prices remained on the rise in the second quarter, and it is estimated that the price increase for Conventional DRAM in the third quarter will be higher than previously expected due to international factors. (5) Advanced Packaging: On August 15th, TSMC officially announced that it will acquire Nanke 4 Plant 5.5-generation factory buildings from AU Optronics for NT$17.14 billion. AUO's Nanke 4 Plant 5.5-generation line accounts for about 10% of its original capacity, which means that AUO will further shrink its traditional TFT-LCD business and accelerate its transformation.
Industry Valuation Above Historical Median: Currently, the PE (TTM) of the SW Electronics sector is 58.24 times, with the average PE (TTM) of the SW Electronics sector from 2019 to present being 49.14 times, indicating that industry valuation is above the historical median level from 2019 to present During the period, the average daily trading volume was 78.296 billion yuan, a decrease of 6.4% from the previous trading week.
Most stocks in the electronic sector rose during the period: Out of the 471 stocks in the Shenwan Electronics Industry, 290 rose while 178 fell, with a rise ratio of 61.57%.
Risk factors: Escalation of Sino-US tech friction; lower-than-expected end demand; slower-than-expected penetration of new panel technologies; slower-than-expected progress in domestic AI chip development; lower-than-expected performance of domestic products