JPMorgan Research Report Analysis: Semiconductor Equipment and Materials Demand Broadly Revised Upwards, Price Increase Signal Clear

marsbit2026-08-18 tarihinde yayınlandı2026-08-18 tarihinde güncellendi

Özet

JPMorgan's research report indicates a simultaneous upward revision in both demand and pricing power for the semiconductor equipment and materials sector. Key chipmakers, including TSMC, Intel, and SK Hynix, are significantly raising their capital expenditure forecasts for 2026, driven by investments in advanced nodes like 2nm/3nm and HBM capacity expansion. This signals an accelerated global capacity build-out. Leading equipment suppliers Tokyo Electron and Screen Holdings have correspondingly raised their 2026-2027 Wafer Fab Equipment (WFE) market outlook, now anticipating stronger growth. Tokyo Electron also highlighted improving gross margins, supported in part by pricing actions, suggesting a shift from volume to value growth. Concurrently, major memory makers (Samsung, SK Hynix, SanDisk) are rapidly securing Long-Term Agreements (LTAs) with hyperscaler customers. These multi-year contracts, often with prepayments, aim to lock in capacity and reduce price volatility. The widespread adoption of LTAs is fundamentally altering the memory industry's pricing dynamics and profit stability. These converging trends—rising chipmaker capex, upgraded equipment forecasts, and the proliferation of memory LTAs—collectively point to a semiconductor cycle increasingly driven by both volume expansion and firming prices, with Japanese equipment and materials firms positioned as primary beneficiaries.

Written by:Rita

Demand and pricing power in the semiconductor equipment and materials industry are being revised upwards simultaneously.

In a semiconductor and technology materials research report released on August 17, JPMorgan compiled key takeaways from the April-June financial results of overseas companies. The report points out that demand across three fronts—chip manufacturers raising capital expenditures, equipment suppliers raising their WFE outlook, and memory LTAs accelerating—is stronger than it was three months ago. Against the backdrop of persistently robust demand, not only memory chip makers but also equipment and materials suppliers are showing signs of gradually raising prices.

Chip Manufacturers Compete to Raise Capital Expenditures

TSMC raised its 2026 capital expenditure guidance to $60-64 billion, an increase of about 15%, with the mid-point representing 52% year-over-year growth. Advanced nodes account for 70% to 80% of capital expenditures, with a focus on 2nm and 3nm. Management stated it is working closely with equipment suppliers, and equipment will not be a bottleneck for capacity. TSMC had previously announced an additional $100 billion investment in Arizona; this capital expenditure revision further confirms that the pace of its global capacity expansion is accelerating.

Intel raised its 2026 capital expenditure from approximately $18 billion to $20 billion (an 11% year-over-year increase), with equipment capital expenditure growing 40% year-over-year, and expects further significant growth in 2027. Most capital expenditures will be directed to the United States, with front-end equipment comprising the bulk, but investment in back-end equipment (related to EMIB-T) is also increasing. The 18A node is expected to enter mass production by the end of 2026, with the 14A node planned for risk production in the second half of 2027 and mass production in 2028. Through its IDM 2.0 strategy, Intel is rebuilding its manufacturing capabilities, and the concentrated release of its equipment purchases will provide sustained momentum for the WFE market.

SK Hynix's 2026 capital expenditure plan is 40 trillion won, a 45% year-over-year increase; M15X's ramp-up has been advanced, and Yongin Fab 1 is set to commence operations in early 2027. Samsung Electronics did not disclose detailed plans, but Taylor Fab 1 is on schedule to start in 2026 with a gradual ramp-up for 2nm, and Taylor Fab 2 is planned to break ground this year for mass production in 2030. The capital expenditure pace of Korea's two memory giants is shifting from observation to acceleration, particularly the demand pull from HBM capacity expansion on front-end equipment, which is becoming an additional growth driver for the WFE market.

Equipment Suppliers Raise WFE Outlook, Gross Margins Improve in Tandem

Tokyo Electron raised its 2026 WFE outlook to above $150 billion and its 2027 outlook to above $190 billion. The previous outlook was $150-170 billion combined for 2026-2027 (over 20% growth from 2025). Management also mentioned that through measures like price increases, gross margins are expected to reach 50% at the beginning of the fiscal year 2027 (versus 47% in April-June 2026). As the world's fourth-largest semiconductor equipment supplier with leading shares in multiple segments like coaters/developers, etch, and deposition, Tokyo Electron's upward revision of its WFE outlook serves as an industry bellwether.

Screen Holdings raised its 2026 WFE outlook from a previously stated year-over-year growth of about 15-20% to over 20% (at least $140 billion) and expects a similar growth rate in 2027. As a global leader in cleaning equipment, Screen's outlook revision further validates that the upward momentum in the WFE market is spreading from top-tier equipment suppliers across the industry.

Memory LTAs Accelerate Coverage, Locking in Capacity and Profits

Long-Term Agreements (LTAs) for memory chips are shifting from "whether to sign" to "how much and with whom." Samsung plans to place 60% to 70% of its DRAM capacity under LTAs; it has already signed five agreements, with another five in final negotiations, involving customers including AWS, Microsoft, Google, Meta, and Oracle. Samsung's LTA pricing mechanism is primarily based on five-year rolling contracts, with approximately 25% prepayment attached.

SK Hynix has signed about ten agreements with durations of around five years, including prepayments. Pricing varies by customer and aims to reduce price volatility. Its leading position in the HBM market gives SK Hynix relatively strong pricing power in LTA negotiations.

SanDisk has signed eight agreements (three with US hyperscalers), with an average duration of four years (up to five years), and has received inquiries from multiple customers for contracts exceeding five years. The agreements cover about 50% of its bit demand for 2027 and about two-thirds for 2028. Prices are either fixed or variable (depending on the customer), with gross margins reaching approximately 80% even at the lower bound of variable pricing structures. SanDisk's LTA terms are the most transparent, operating a dual-track system of fixed prices and variable prices with upper and lower bounds, allowing customers to choose based on their needs.

The differences in LTA terms among the three vendors are establishing new industry pricing benchmarks. Samsung pursues high-coverage rolling agreements, SK Hynix focuses on duration and pricing stability, while SanDisk offers flexible pricing options. JPMorgan believes that LTAs are changing the pricing logic and profit stability of the memory industry, with the equipment and materials segments being the extended beneficiaries of this trend. These three signals point in the same direction: the semiconductor equipment and materials boom cycle is shifting from volume expansion to a dual drive of volume and price. Japanese semiconductor and technology materials companies are likely to be the primary beneficiaries of this trend.

Disclaimer

This article is an organization and interpretation by Tide Research of a third-party brokerage research report (JPMorgan, August 17, 2026), combined with the compilation of public market information. The ratings, target prices, earnings forecasts, and related judgments cited in the article are the views of the analyst from that brokerage, representing only the position of their affiliated institution. They do not represent the views of Tide Research and do not constitute any investment advice.

The market carries risks, and decisions should be made independently. This article should not be used as a basis for buying or selling any securities.

İlgili Sorular

QWhat are the three key demand signals highlighted in the JPMorgan report that indicate strengthening in the semiconductor equipment and materials sector?

AThe three key demand signals are: 1) Chipmakers raising their capital expenditure (capex) guidance, 2) Equipment suppliers raising their Wafer Fab Equipment (WFE) outlook, and 3) An acceleration in the signing of Long-Term Agreements (LTAs) by memory chipmakers.

QWhich companies are specifically mentioned as raising their capital expenditure plans for 2026, and by what amounts?

ATSMC raised its 2026 capex guidance to $60-64 billion (a ~15% increase, with a midpoint up 52% YoY). Intel raised its 2026 capex from ~$18 billion to $20 billion (an 11% increase). SK Hynix's 2026 capex plan is 40 trillion KRW, representing a 45% year-on-year increase.

QHow did Tokyo Electron and Screen Holdings revise their Wafer Fab Equipment (WFE) market outlook?

ATokyo Electron raised its WFE outlook to over $150 billion for 2026 and over $190 billion for 2027. Screen Holdings revised its 2026 WFE growth forecast from approximately 15-20% to over 20% year-on-year (implying at least $140 billion), with a similar growth rate expected for 2027.

QWhat is the significance of Long-Term Agreements (LTAs) for memory chipmakers according to the article?

ALTAs are shifting the industry's focus from whether to sign them to negotiating volume and terms. They lock in future capacity and revenue, provide pricing stability, and reduce exposure to price volatility. The article suggests LTAs are changing the pricing logic and profitability stability of the memory sector, with benefits extending to the equipment and materials segments.

QWhat trend does the article conclude is emerging for the semiconductor equipment and materials cycle?

AThe article concludes that the semiconductor equipment and materials cycle is transitioning from a phase driven primarily by volume expansion to a phase driven by both volume and price, indicating a dual-momentum trend of rising demand and increasing pricing power.

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