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Yesterday on

TSMC $TSM JUST REPORTED ANOTHER RECORD MONTH. THE AI BOOM IS ACCELERATING, NOT SLOWING DOWN. TSMC’s October 2026 revenue surged to NT$586.9 billion, up 14.7% MoM and 59.7% YoY, representing another record high and a remarkable acceleration from September’s 54.6% YoY growth. What makes these numbers particularly impressive is that the sequential increase came from an already exceptionally high revenue base, suggesting that demand for advanced semiconductor manufacturing continues expanding at an extraordinary pace rather than merely benefiting from favorable comparisons. I think this reinforces our structural AI investment thesis because TSMC sits at the center of the global advanced semiconductor supply chain, manufacturing leading-edge chips for companies such as NVIDIA, Apple, AMD and other major technology players, while increasingly sophisticated AI accelerators, custom silicon and advanced packaging continue driving demand for scarce manufacturing capacity. October alone represented approximately 34.6% of the midpoint of TSMC’s fourth-quarter revenue guidance, suggesting a strong start to the quarter, although monthly revenue can fluctuate and one month does not guarantee a guidance beat. The most important distinction is that this is not simply a semiconductor industry recovering from a cyclical downturn, but an increasingly powerful structural investment cycle driven by the enormous expansion of AI computing infrastructure. TSMC remains one of the clearest ways to gain exposure to that opportunity because it benefits from the capital spending of multiple competing chip designers rather than depending on any single AI architecture. We remain long TSMC. As long as AI computing demand continues expanding faster than the industry’s ability to supply advanced chips, I believe the company remains exceptionally well positioned to benefit. Long $TSM. Long AI.

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1w ago on

INTEL $INTC JUST CRASHED 24% AFTER HOURS DESPITE BEATING EARNINGS EXPECTATIONS BY 30%. BRUTAL. Welcome to a market where even a strong quarter means NOTHING if your forward guidance disappoints. Intel's Q3'26 results were actually impressive. Revenue: $16.5B, +21% YoY Adjusted EPS: $0.52 vs. $0.40 expected Gross margin: 44.1%, +410bps YoY Data Center & AI: $7.3B, +78% YoY But then came the guidance. Q4 revenue: $15.5B midpoint vs. $17.1B expected. Q4 adjusted EPS: $0.25 vs. $0.43 expected. Gross margin expected to collapse from 44.1% to 38%. And the market absolutely HATED it. Here's what makes Intel particularly interesting. THE AI BOOM IS HELPING INTEL'S SERVER BUSINESS WHILE HURTING ITS PC BUSINESS. Exploding AI infrastructure demand is driving server CPU sales, but the same boom is contributing to soaring memory prices, making PCs more expensive and depressing consumer demand. Meanwhile, Intel Foundry remains deeply unprofitable, losing approximately $1.85B in Q3, despite reporting $6.7B in revenue, most of which comes from internal manufacturing activity rather than external customers. And here is my biggest concern. INTEL WAS TRADING AT 42.2x FY27 FORWARD EARNINGS BEFORE THE SELLOFF. That's an extraordinary valuation for a company still navigating a difficult turnaround, substantial manufacturing risks, persistent foundry losses and significant capital requirements. Even after a 24% decline, the stock would mechanically trade around 32x forward earnings, assuming estimates remain unchanged. And remember, Intel recently completed a $23B equity offering, introducing substantial shareholder dilution. I believe Intel's operational recovery is genuine, particularly in server CPUs, but improving fundamentals do not automatically make a stock attractive when the valuation already assumes a successful turnaround. We currently do NOT own Intel, and the 24% collapse alone is not enough to make us buyers. I remain much more comfortable owning established AI infrastructure winners such as $NVDA, $TSM, $GOOG, $AMZN and $SKHY. The AI boom is real. But not every semiconductor company deserves an AI valuation. The market rewards earnings today, but ultimately prices the earnings of tomorrow.

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2w ago on

ANTHROPIC COULD BECOME A $500 BILLION REVENUE MACHINE BY 2030. AND STILL BE A DISAPPOINTING INVESTMENT. FUNDA's @FundaAI latest financial model is absolutely fascinating. Here's what it forecasts: 2026 revenue: $52.8B 2027 revenue: $118.3B 2028 revenue: $197.9B 2029 revenue: $304.4B 2030 revenue: $438.4B By December 2030, Anthropic could reach an astonishing $504 BILLION annualized revenue run rate. But here's where things get REALLY interesting. Despite explosive revenue growth, adjusted operating margins are projected to deteriorate to -12.9% in 2027, before recovering to 25.9% by 2030. Why? THE COMPUTE BILL. Anthropic's annual compute costs are projected to explode from $33.8B in 2026 to $212 BILLION by 2030. This is no ordinary SaaS business. It is becoming one of the most capital-intensive businesses on Earth. And here's the valuation problem. At a hypothetical $2T IPO valuation, even if Anthropic delivers $87.9B of net income by 2030 and trades at 25x earnings, investors would earn only around 2.4% annualized over four years. At $1.5T, that rises to approximately 10%. Same company. Same extraordinary growth. Very different investment returns. I remain extremely bullish on AI and Anthropic's commercial prospects, but the model reinforces why I prefer owning the infrastructure bottlenecks: $NVDA, $TSM, $ASML, $SKHY and $AVGO. They sell the compute. Anthropic must prove it can monetize the intelligence profitably. The biggest risk to AI investors isn't necessarily that AI fails. It's that AI succeeds spectacularly, but investors overpay for the companies building it. I would consider Anthropic closer to a $1.5T valuation. At $2T, considerably less interested. The AI revolution can exceed expectations while your investment returns disappoint.

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2w ago on

$SKHY just reported numbers that make most software companies look like low-margin businesses. Absolutely INSANE. SK Hynix 3Q26: Revenue: US$78.9B, +328% YoY Operating profit: US$62.8B, +632% YoY Gross margin: 85.7% Operating margin: 80%, a RECORD HIGH Yes, 80% operating margin for a MEMORY CHIP MANUFACTURER. But the real story is even more interesting. DRAM prices surged nearly 30% QoQ, while NAND prices jumped approximately 25%, demonstrating extraordinary pricing power across the memory industry. Meanwhile, HBM4 is ramping aggressively, and management expects memory demand to OUTSTRIP SUPPLY THROUGH 2030. Even more remarkable, SK hynix has secured over 50% of its planned 2027–2028 capacity through long-term agreements with 14 major customers. Think about what we are witnessing. $NVDA cannot make enough accelerators. $TSM cannot make enough leading-edge chips. $ASML cannot supply enough lithography equipment. $SKHY cannot produce enough advanced memory. Four different companies. Four different bottlenecks. The SAME MESSAGE. AI infrastructure demand is growing faster than physical supply can expand. Of course, 80% operating margins will not last forever, and rising capex warrants monitoring, but the idea that the AI infrastructure cycle is already running out of momentum looks increasingly difficult to defend. SK Hynix is one of our portfolio holdings, and these results reinforce our conviction. AI intelligence is getting cheaper. AI memory is getting more expensive. And the companies controlling the bottlenecks are capturing extraordinary economics. LONG AI.

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3w ago on

$TSM just delivered another ridiculous quarter. Revenue: US$46.7B, +41% YoY Net profit: US$23.6B, +69% YoY Gross margin: 66.4% Operating margin: 58.7% ROE: 45.5% This is now TSMC’s 6th consecutive quarter of record profits. But the most interesting number is elsewhere: wafer shipments grew only 9.6% YoY, while revenue grew 50.9% in NT$. That tells you exactly what is happening. AI does not merely need more chips. It needs far more valuable chips. 2nm + 3nm + 5nm + 7nm already account for 79% of wafer revenue, while HPC has exploded to 68% of total revenue. NVIDIA can win. AMD can win. Google TPU can win. Amazon Trainium can win. Custom ASICs can win. TSMC monetizes the war regardless. And despite massive capex, it still generated NT$477B of quarterly free cash flow. At only 17.1x forward P/E and 11.3x EV/EBITDA, I still think the valuation is extremely attractive for arguably the most important semiconductor manufacturer on Earth. The market keeps debating whether AI capex can generate returns. TSMC is already showing us the answer in its income statement. Long $TSM. One of our core portfolio positions.