Tower Semicon

It’s been a little disappointing to see a pattern with some people I've interacted with on X:

- try to engage with the same audience, then quickly move toward aggressively monetizing it

- get upset when I choose not to participate in or amplify paid groups

- throw out personal or illogical attacks and try to reframe that as simply disagreeing over fundamentals

When I first joined X, a lot of finance content revolved around watches/private jets + options, paywalled communities promising the "secrets of Wall Street," and squiggly-line charts.

One of the things I've wanted to do differently is publish my research and reasoning openly, for everyone.

I think this definitely resonated with folks given my follower growth.

But of course, this growth can also create friction with people whose business models rely on using X to funnel audiences into paid services or expensive paywalls.

My subscription has been $1 for months and will stay at the minimum, despite claims at the beginning I would raise it to $100.

All of my core theses are published on the main timeline for free. I could put substantially more behind a paywall. I just don't want to.

I just prefer sharing the ideas openly and letting everyone decide for themselves.

Many ideas have worked out well: $AXT(AXTI.US), $Nebius(NBIS.US), $Aehr Test(AEHR.US), $Micron Tech(MU.US), $Intel(INTC.US), $EWY, $Marvell Tech(MRVL.US), $Lumentum(LITE.US), $RPI, $IQE, $SOI, $Tower Semicon(TSEM.US), $Arm(ARM.US), $Coherent Corp.(COHR.US), and a lot more.

Others ran into unexpected industry delays, like $LPKF with glass substrates and Auros with hybrid bonding.

Some are still playing out into 2027/2028, including $SIVE, Foci, Shunsin, $Churchill Capital XI(CCXI.US), $XFAB and the broader CPO/humanoid themes.

Some are brand new like Etron/ESMT for DDR2/DDR3.

And many like $Jabil(JBL.US) to Murata to $Maxlinear(MXL.US), I just share for fun to see if the idea is right.

Not every idea will be right. That's part of research.

But I'd much rather have an X where people openly publish the thesis and reasoning so everyone can learn from it.

Than one where information increasingly disappears behind $100 paywalls or becomes diluted with engagement-bait noise.

Hopefully I can help create a new culture on X rather than amplify the old one.

Nomura Securities: Global optical laser chip eco-system and competitive landscape

InP Wafer

AXT $AXT(AXTI.US)

Sumitomo Electric $5802.T

JX Advanced Metals $5016.T

Coherent $Coherent Corp.(COHR.US)

Lumentum $Lumentum(LITE.US)

Epi Wafer

IQE $IQE.L

Landmark Optoelectronics $3081.TW

VPEC $2455.TW

Coherent $Coherent Corp.(COHR.US)

Lumentum $Lumentum(LITE.US)

Sumitomo Electric $5802.T

Wafer Equipment

Aixtron $AIXA.DE

Veeco $Veeco Instruments(VECO.US)

Taiyo Nippon Sanso $4091.T

CW/EML Laser

Lumentum $Lumentum(LITE.US)

Coherent $Coherent Corp.(COHR.US)

Sumitomo Electric $5802.T

Mitsubishi Electric $6503.T

SiPho Foundry

Tower Semiconductor $Tower Semicon(TSEM.US)

GlobalFoundries $GlobalFoundries(GFS.US)

TSMC $Taiwan Semiconductor(TSM.US)

Chip Equipment

FormFactor $Formfactor(FORM.US)

Keysight Technologies $Keysight Tech(KEYS.US)

Anritsu $6754.T

Morgan Stanley: Soitec

Financial Performance & Estimates

> F1Q27 Beat: Revenue came in at €113 million, beating street estimates by 6% and marking a 23% year-over-year growth ( outpacing the company's 15% guide).

> Strong Guidance: F2Q27 revenue growth is guided at more than 30% year-over-year, blowing past the 4% consensus expectations.

> Significant Earnings Upgrades: Morgan Stanley raised its revenue estimates for FY27–FY29 by 8–19% and upgraded EPS for FY28 and FY29 by 43% and 32% respectively, projecting almost €8 of EPS by FY29. 💡

Core Investment Drivers (Photonics-SOI)

> The Growth Engine: The stellar performance and guidance are heavily driven by Photonics-SOI demand for high-speed optical interconnects in AI data centers.

> Doubling Revenue: Management explicitly noted that Photonics-SOI FY27 revenue is expected to more than double, acting as the catalyst the market had been anticipating.

> Secular Alignment: Soitec’s stellar outlook mirrors broader industry tailwinds from major players scaling up silicon photonics (SiPho) capacity—such as Tower Semiconductor, STMicroelectronics, and TSMC. Photonics is expected to scale from roughly 8% of Soitec's revenue in FY25 to about one-third in the current fiscal year.

Scenario Analysis (Price Target Cases)

> Bull Case (€300.00): Assumes a stronger recovery in RF-SOI alongside more aggressive, accelerated growth in Photonics-SOI, paving the way for €10 in earnings power.

> Base Case (€200.00): Assumes multi-year growth in Photonics-SOI and normalization in RF-SOI, applying a 25x multiple to CY28 (FY29) EPS.

> Bear Case (€80.00): Assumes a slower RF-SOI recovery and weaker Photonics growth, applying a 20x multiple to discounted bear-case earnings.

$IQE has unfortunately not been performing well recently.

However, we've only had net-positive news since May:

- $Tower Semicon(TSEM.US) multi year InP epiwafer agreement in June w/ minimum purchase commitments from year two

- $14M multi year PO from a "strategic global technology leader" for AI/datacentre applications this week

- $Macom Tech(MTSI.US) board involvement after anchoring a £81M raise to strengthen balance sheet

That said, it does seem like IQE is simply resetting (similar to other high beta names like $SIVE) after going up parabolically in a few months.

And Chinese export curbs on gallium + InP feedstock are inflating input costs with management also saying that they're sharing that pain with customers.

I'm also looking at the fact that their balance sheet almost ruined them a few years ago - which is now solved thanks to £45M from MACOM as a strategic investor tied to LTAs.

IQE is one of the only Western epi houses that can supply InP epiwafers at a scale that actually matters.

And InP sits under every optical interconnect going into datacentres.

Tower didn't sign a multi year supply deal and settle a long standing patent dispute in the process because it had alternative routes to source supply...

So currently, you've got:

1. A repaired balance sheet.

2. An anchored strategic partner w/ Macom.

3. Contracted InP volumes.

4. An option on photonics too.

However, risks are definitely real and please do not act on my words alone...

They've had execution issues in the past e.g. too much internal resource in their wireless segment which has been dying a slow death over the past couple years. (They're correcting that now just by going from their investor decks).

Plus of course a long dilution history. And China risks impacting input costs.

Drawdowns like the one we're in currently are all part of the game.

Where highly volatile businesses = highly volatile returns.

Morgan Stanley on CPO:

What are the Transmission Approaches As Industry Eventually Hits "Copper Wall"?

"Co-packaged optics (CPO) is emerging as a critical architectural shift for AI datacenter networking, driven by the rising power, bandwidth, and density constraints of traditional pluggable optical modules"

"Reduced interconnect power is the most tangible near-term benefit, with CPO potentially lowering optical interconnect power consumption by roughly 50-80%"

"Key participants include Broadcom and NVIDIA in switch platforms, Lightmatter, Ayar Labs, Marvell/Celestial AI, and POET in optical engines and photonics, TSMC, GlobalFoundries, and Tower in silicon photonics foundry capacity, and Lumentum, Coherent, and Sivers in laser supply."

IEEE: CPO Ecosystem

Silicon Photonics Manufacturers

Intel $Intel(INTC.US)

TSMC $Taiwan Semiconductor(TSM.US)

Samsung Electronics $005930.KS

GlobalFoundries $GlobalFoundries(GFS.US)

Tower Semiconductor $Tower Semicon(TSEM.US)

External laser Vendors

Lumentum $Lumentum(LITE.US)

Coherent $Coherent Corp.(COHR.US)

Intel $Intel(INTC.US)

Furukawa Electric $5801.T

Molex

Suzhou TFC Optical Communication $300394.SZ

VCSEL Manufacturers

Broadcom $Broadcom(AVGO.US)

Coherent $Coherent Corp.(COHR.US)

Lumentum $Lumentum(LITE.US)

Adtran $Adtran(ADTN.US)

Trumpf

Vertilas

Vanguard International Semiconductor $5347.TW

Substrate Suppliers

Unimicron $3037.TW

Ibiden $4062.T

Shinko Electric Industries $6967.T

AT&S $ATS(ATS.US).VI

Nanya PCB $8046.TW

Samsung Electro-Mechanics $009150.KS

uLED Manufacturers

ams-OSRAM $American Shared Hosp(AMS.US).SW

Nichia

Lumileds

Foundries + OSATs

TSMC $Taiwan Semiconductor(TSM.US)

ASE Group $Advanced Semiconductor Engineering(ASX.US)

Amkor Technology $Amkor Tech(AMKR.US)

Intel $Intel(INTC.US)

Samsung Electronics $005930.KS

GlobalFoundries $GlobalFoundries(GFS.US)

SPIL - subsidiary of ASE Group $Advanced Semiconductor Engineering(ASX.US)

IBM $IBM(IBM.US)

ODMs + OEMs

Foxconn / Hon Hai Precision Industry $2317.TW

Fabrinet $Fabrinet(FN.US)

Jabil $Jabil(JBL.US)

Glass Interposer Suppliers

Corning $Corning(GLW.US)

Intel $Intel(INTC.US)

ColorChip

Equipment/Metrology Suppliers

Keysight Technologies $Keysight Tech(KEYS.US)

FormFactor $Formfactor(FORM.US)

ficonTEC - subsidiary of RoboTechnik Intelligence Technology $300757.SZ

Yagishita Giken

Data-Pixel

Sumix

Connector/Receptacle Suppliers

US Conec

Senko Advanced Components - subsidiary of SENKO Group $9069.T

Corning $Corning(GLW.US)

Sumitomo Electric $5802.T

Furukawa Electric $5801.T

Teramount

Hakusan

Orbray

Twinstar

Fiber Suppliers

Corning $Corning(GLW.US)

Sumitomo Electric $5802.T

Fujikura $5803.T

Prysmian Group $PRY.MI

OFS - subsidiary of Furukawa Electric $5801.T

Yangtze Optial Fibre and Cable $6869.HK

$IQE & $Tower Semicon(TSEM.US) enter a multi-year InP epiwafer supply agreement.

Do you understand how f*cking huge this is for IQE?

-> IQE is being designed into the pluggable wave + next-gen modulator/OCS roadmap.

-> Confirms IQE as a qualified, non-Chinese InP epiwafer source.

-> Diversifies IQE's optical customer base beyond $Lumentum(LITE.US) / $Macom Tech(MTSI.US) to foundry in $Tower Semicon(TSEM.US). So multiple Tier-1 optical anchors.

Quick fun fact: IQE sued Tower in 2022 for misappropriating trade secrets to obtain patents.

So this Tower agreement lets IQE keep optionality on RF SOI type + engineered substrate/layer transfer applications without IP risk.

And converts a former enemy into a customer - always a massive bullish signal that a company's products are critical.

Okay... just some more weekend shower thoughts about $XFAB.

I still feel like it could be the next $Tower Semicon(TSEM.US), just early stage at a $1.4B MC?

They kinda leapfrogged current gens (which $Tower Semicon(TSEM.US) are getting volume from) to compete for H2 2027 CPO scale up inflection point ($Advanced Semiconductor Engineering(ASX.US) docs cite Xfab (aka. photonixFAB) as focusing on CPO)

By building out some black magic MTP (transfer printing) architecture for lasers w/ other stuff like TFLN.

Basically next-gen integration IP, they're still behind on yields, sure.

But $NVIDIA(NVDA.US) evaluating it for transceivers/switches to see if it can volume ramp. That $Nokia Oyj(NOK.US) sets the specifications/assembly for. (nvidia invested in nokia for this these switches/networking too btw).

And if their MTP supply chain works... (eg. with Smartphotonics providing lasers, EU players doing assembly).

It basically volume ramps with $NVIDIA(NVDA.US) just like why Nvidia signed long term agreements with $Tower Semicon(TSEM.US)?

Downside risk?

Already below replacement book value, can always go lower yeah, but typically to a certain point.

Maybe more CHIPS act subsidies next few months from chips act 2. If it doesn't go well there's SiC (152% Y/Y Growth, 195% Y/Y SiC wafer shipment growth)/GaN power semi upside.

Europeans /LLMs will say "oh evaluations doesn't mean it's a future contract!".

This is kinda different since the European Union is behind this effort and $XFAB for soverign photonic supply chains.

Not your typical company + hyperscaler evaluation, since $NVIDIA(NVDA.US) wants to be nice to Europe's regulators. They'd prob be pissed if nvidia just stayed in US/Taiwan/China.

So if they can make this MTP black magic work with mass production, feels almost for sure nvidia/nokia volume ramp on some tiny $1.4B silicon photonics foundry or at least throw them a bone with smaller contracts.

In terms of timelines, maybe just a months early since it volume ramps H2 2027/H1 2028 (which happens to be in line with CPO scale up timelines)...

Or just unknown because they named their project something stupid like photonixfab?

Like XFAB Photonics would have been better? so institutions/screeners can connect the dots when looking at CPO silicon photonic foundry players?

Automotive should also coming out of a slump medium term, sped up by self-driving (TSM Chairmain comments yesterday said ai automotive was TSM's growth vector alongside robotics). So their core business also should pick up speed too medium term.

Obviously markets/europeans want a "Nvidia signs $2B+ contract, XFab volume ramping 2027!"

But by then it will be a $9B+ company and you miss out on all the upside. And especially since everyone analyst/institution is blind to volume expectations for these....

Normally don't invest in companies in evaluation stages, but this just seems very de-risked by EU sovereignty + Gov backing, and you have Nvidia + Nokia there for volumes if they can make the IP work.

I think markets are probably missing something here... there's almost 0 value being assigned to being CPO exposure in Europe as their long term upside.

Just in case you want to frontrun the next major catalyst:

$NVIDIA(NVDA.US) June 1 Computex/GTC Taipei keynote should be heavily bullish Taiwan optical ecosystem?

Just like when I went long on $Tower Semicon(TSEM.US) and others in Nvidia’s US event.

Shunsin, Foci, Nextronics, MSScorps, and a lot of my Nvidia photonics ecosystem port might be critical mentions or have indirect catalysts there.

Source: Serenity

Breaking: Leopold Aschenbrenner just filed his Q1 2026 13F

Here's everything you need to know about his recent 13F

Top 10 positions:

1. VanEck Semiconductor ETF $SMH [Put] — $2.04B

2. Nvidia $NVIDIA(NVDA.US) [Put] — $1.57B

3. Oracle $Oracle(ORCL.US) [Put] — $1.07B

4. Broadcom $Broadcom(AVGO.US) [Put] — $1.01B

5. Advanced Micro Devices $AMD(AMD.US) [Put] — $969M

6. Bloom Energy $Bloom Energy(BE.US) — $879M

7. SanDisk $Sandisk(SNDK.US) — $724M

8. Micron $Micron Tech(MU.US) [Put] — $584M

9. CoreWeave $Coreweave(CRWV.US) — $556M

10. Taiwan Semiconductor $Taiwan Semiconductor(TSM.US) [Put] — $535M

New positions:

• $SMH, $NVIDIA(NVDA.US), $Oracle(ORCL.US), $Broadcom(AVGO.US), $AMD(AMD.US), $Micron Tech(MU.US), $Taiwan Semiconductor(TSM.US), $ASML(ASML.US), $Intel(INTC.US), $Corning(GLW.US) — all puts

• $Micron Tech(MU.US) [Call] — $422M

• $Taiwan Semiconductor(TSM.US) [Call] — $355M

• $Sandisk(SNDK.US) [Call] — $389M

Biggest adds:

• CleanSpark $CleanSpark(CLSK.US): +648% shares

• Riot Platforms $Riot Platforms(RIOT.US): +87% shares

Biggest trims:

• CoreWeave $Coreweave(CRWV.US) [Call]: -83% shares

• Bloom Energy $Bloom Energy(BE.US): -36% shares

Full exits:

• Intel $Intel(INTC.US) [Call] — was $747M

• Lumentum $Lumentum(LITE.US) — was $479M

• EQT Corp $EQT(EQT.US) — was $133M

• Tower Semiconductor $Tower Semicon(TSEM.US) — was $85M

Summary: He kept his AI infrastructure longs and opened $8.45B in new puts against tech and semiconductor