J.正式版. 摩根-美股半导体行业-TMC会议摘要：需求强劲基础广泛供应紧张会持续到2022年-2021.5.27-23正式版

Semiconductors

TMCConferenceSummary:DemandStrongandBroad-Based;SupplyConstraintsInto2022;ExpectSemis/SemicaptoOutperform

Thisweek,wehosted17semiconductorandsemiconductorcapitalequipmentcompaniesatour49thannualGlobalTechnology,Media,andCommunicationsConference,heldvirtually.Discussionsatthisyear’seventcenteredonthecurrentsupply/demandimbalanceandthesustainabilityofthecurrentsemiconductorup-cycle.Allofourcompaniesundercoveragediscussednear-termdemandexceedingsupplyandmostcompaniesexpectthetightdemand/supplydynamicstoextendwellintoCY22.PostastrongQ2earningsseason,companiesarecontinuingtoseestrongorders,veryleanchanneldistributioninventories,extendedleadtimes,andstrongerthannormalpricingtrends,whichareallreflectiveofthestrongdemandandtightsupplyenvironment.Moreover,companiesexpressedconfidenceincontinued,albeitmodest,capacityexpansionaswemovethroughthesecondhalfoftheyear,suggestingH/Hgrowthinthesecondhalfoftheyear.RecentCOVID-19surgesinAsiaarehavingalimitedimpactonsupplychainatthisstageascompanieshavebeenproactiveinmitigatingfactoryoutbreaksandmovingcapacitytootherlocations.Onthedemandside,companiesareseeingbroad-baseddemandstrengthacrossauto,industrial,PC,gaming,smartphones(remainstrongwithnosignsofordercuts),ontopofclouddatacenterspendingreaccelerationhereintheJune-Qtrandintothe2H.Companieswithexposuretoglobal5Ginfrastructurebuild-outs(e.g.ADIandQorvo)havevisibility(andarereceivingorders)forspendingtoimproveinsecondhalfoftheyear(withinvestmentsbroadeningoutglobally),whileChina5Greaccelerationvisibilityisstillunclear.Foroursemiconductorcoverageuniverseasawhole,wecontinuetoexpectstrongerrevenuesinthesecondhalfoftheyearANDinto2022asdemandtrendsremainstrongandascompaniescontinuetoaddincremental/disciplinedcapacitygoingforward.Insemicaps,demandtrendsremainstrongandcompaniesarecomfortableonthesustainabilityofWFEspendinginto2022andoveramulti-yearbasiswithopportunitiestooutperform.Inmemoryandstorage,supply/demandfundamentalsaretightinDRAM(intoCY22)andimprovinginNANDandMicronandWDdiscussedindustryparticipantsremainingdisciplinedintermsofaddingsupply.WecontinuetoremainpositiveonsemiconductorandsemiconductorequipmentstocksgiventhatwecontinuetoseestrongindustryfundamentalsintoCY22combinedwithimprovedprofitabilityprofilesofcompaniesundercoverageandwithcompaniesdeliveringstrongcapitalreturns.

NorthAmericaEquityResearch

27May2021

Semiconductors&SemiconductorCapitalEquipment/ITHardware

HarlanSurAC

(1-415)315-6700harlan.sur@BloombergJPMASUR<GO>

BillPetersonAC

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BloombergJPMAPETERSONB<GO>

PeterKPeng

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Seepage20foranalystcertificationandimportantdisclosures.

J.P.Morgandoesandseekstodobusinesswithcompaniescoveredinitsresearchreports.Asaresult,investorsshouldbeawarethatthefirmmayhaveaconflictofinterestthatcouldaffecttheobjectivityofthisreport.Investorsshouldconsiderthisreportasonlyasinglefactorinmakingtheirinvestmentdecision.

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Supply/demandimbalanceextendingintoCY22.Allofourpresentingcompaniesdiscussednear-termdemandexceedingsupplyandmostcompaniesexpectthetightdemand/supplydynamicstoextendintoCY22andinsomecasestowardtheendofCY22.Thatsaid,mostcompaniesexpressedconfidenceincontinuedcapacityexpansionaswemovethroughthesecondhalfoftheyear,suggestingH/Hgrowthinthesecondhalfoftheyear(somecompaniesseeQ/Qgrowththrough2H21).Inaddition,webelieveourcompaniesarewellpositionedtocapturethestrongdemandthroughprudentinventorymanagement(i.e.ONandADI)andflexibleoperationsplanning(ON/MCHP).Supplysideindicatorsremaintightacrossallendmarketsandleadtimesarestretchedwithsomecompaniesreportingleadtimes2xabovenormallevels(andinmanycasesintonextyear).Givencontinuedstrongdemandacrossallendmarkets,depletedchannelinventory,extendingleadtimes,andstrongbacklog,webelievethecurrentsemiconductorup-cycleshouldextendwellintoCY22.Notably,Microchipmentionedthatthesupply/demandgaphasactuallywidenedwithdemandnowexceedingsupplybyabout50%(upfrom40%atthetimeofearnings).

RecentCOVID-19surgeshavehadalimitedimpactonthesupplychainthusfar.DespitetherecentCOVID-19resurgenceinSoutheastAsia,mostofourcompanies(i.e.MU/LRCX/ON/KN)havebeenproactiveinmitigatingfactoryoutbreaks(i.e.followingstrictoperatingproceduresandCOVIDtesting)anddidnothavetoshutdowntheirfactories.Factoriesarestillrunning(butatreducedoutputlevels)andinsomecasescompanieshavebeenproactivelymovingcapacitytootherlocationsmitigatingneartermdisruptions(i.e.Malaysiapartialshutdown).

SustainedPCdemandanddatacenterspendingisreacceleratinghereintheJunequarter.Presentingcompanieswithdatacenter,PC,andgamingexposuresuchasAMD,INTC,MU,MCHPandWDC,alldiscussednear-termdemandstrength,in-linewithourexpectationandviewsexpressedduringearnings.Server/datacenterdemandisreacceleratinghereintheJun-Qtrandshouldinflectsolidlyinthesecondhalfoftheyear.Infact,Intelbelieves1Q21waslikelythebottomandIntelseesenterprise,governmentandcloudcustomerdemandimprovingfromhere,drivingY/Yrevenuegrowthin2H21indatacenter.Micronalsopositivelypre-announcedMayquarter(F3Q21)revenues(atorabovethehigh-endofpriorguidance)reflectiveofbroad-basedenddemandandcloudspendingreaccelerationnotingthatthecloud‘digestionisover’.Asdemandcontinuestoexceedsupply,companieshadtoprioritizeshipmentsleavingsomesegmentslikelower-endPCsunderserved.

AutomotiveandIndustrialdemandremainsstrongandhavethelargestsupply/demandgap.Manyofourbroad-basednameshavepointedtostrongautodemandandbroad-basedstrengthinindustrialend-marketsbolsteredbycontentincreases.InAuto,inadditiontothestrongAutoSAARrecovery,manyofourcompanies(ADI,ON,andMCHP)havediscussedstrongcontentgrowthinADASandelectrification.ONSemibelieves70%ofitsautobusinessshouldoutpaceAutoSAARunitgrowth.InIndustrial,allsub-segmentsarefiringwithseculartailwindsinfactoryautomationandalternativeenergysolutions.Forexamplewhilecurrentlyasmall%ofsales,theADIteambelievestheirEVcharginginfrastructure/storagesegmentcandoubleeveryyearforthenextfiveyears.Companieswithexposuretofactoryautomationandbuildingautomationareseestronggrowthandcontentopportunitiesandwithdemandtailwindfromsemiconductormanufacturingon-shoreinitiatives.Webelievetheseend-marketsshouldcontinuetoremainstrongwellintoCY22andwithasubstantialsupply/demandgapwhichwedon’texpecttocloseexitingtheyear.

5Ginfrastructureinvestmentsshouldbegintoreaccelerateinthesecondhalfoftheyearandintonextyear…although5GinfrastructureinChinaisnotfiring.CommentaryfromQorvo,AnalogDevicesandMACOMcontinuetosuggest5Ginfrastructureinvestmentsreacceleratinginthesecondhalfoftheyear.Nearterm

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demandislumpygiventhe5GChinapausebutvisibilityisimprovinginthesecondhalfoftheyeardrivenbyglobal5Gdeployment(especiallyinNorthAmerica).ADIandQorvobothnotedthattheyhavestartedtoreceiveorhavereceivedordersfortheglobal5Grollout(outsideofChina),whileMACOMiscautiouslyoptimisticofChinarecoveringlaterinCY21.Inoptical,MaxLinearsawthewirelessbackhaulbusiness(modemsandtransceivers)reacceleratelastquarterandexpectscontinuedsolidgrowththroughtheyear.In5Gaccess(5GmassiveMIMOtransceivers),MaxLinearrecognizedrevenuein1Q21andshouldcontinuetogrowinthe2H21and2022.

Near-termsmartphoneandwirelessIoTdemandtrendsremainsolidwithmorerunwayforcontentgrowthoverthenextfewyears.CompanieslikeQorvoandMicrondiscussedstrongneartermdemandtrendsinmobilewithnosignsofordercutsfromsmartphonecustomers(inaggregate).Infact,Qorvohasreceivedordersintonextyear.ForQorvodistributionchannelinventoryaredepletedandin‘daysratherthanweeks’.Qorvoreiteratedits2020smartphoneunitgrowthof5-10%Y/Yandadoublingof5Gsmartphoneunitswith~$5-$7ofaveragecontentupliftper5Gphone.Knowles,SynapticsandSiliconLabsdiscussedstrongandbroad-basedIoTdemand.Wi-Fidemandhasalsobeenstrongwithcontentgainopportunities(i.e.MaxLinearseescontentmorethandoublingwhenmovingfromWi-Fi6toWi-Fi7).

MemoryandStoragefundamentalsstrong….MUexpectsDRAMsupplytightnessintoCY22.Reflectiveofthestrongdemandandtightsupplycreatingafavorablepricingenvironment,MicronpositivelypreannouncedMayquarterrevenuestobeatorabovethehighendofguidancewith‘strong’GMandEPS,thatweattributetoastrongpricingenvironment,especiallyinDRAM.Wethinkpricingwillcontinuetobefavorablethrough2021(MicronCEOexpectscontinuedtightDRAMsupplyintoCY22)amidtightsupplyandstrongdemand.ForNAND,Micronhasseenpricingimproveandis‘cautiouslyoptimistic’onindustrysupplyremainingdisciplinedandthuskeepingS/Dfundamentalsconstructive.Similarly,WDcommentedthatitisseeingindicationsofNANDsupplylaggingdemandin2H21.Onthestorageside,WDseesstrengthfromhyperscalecustomersforbothitsHDDsandSSDsinrecentstrongdemandfromChiacryptocurrencyforHDDsinparticular.

Semiconductorequipmentdemandenvironmentstrongandlikelytoremainstrongoveramulti-yearbasisonrisingcapitalintensityandstrongsemiconductordemand.AppliedMaterials,LamResearch,KLA,andAdvancedEnergy(AEIS,notcovered)allhavediscussedstrongnear-termdemandforsemiconductorequipmentdrivenbybroad-basedstrengthacrossallend-devicetypesandleadingandlaggingedgetechnologies.Moreoverimportantly,thecompanieshaveexpressedconfidenceinthesustainabilityoftheWFEspendingstrengthintoCY22andoveramulti-yearperiodonincreasingcapitalintensityandstrongsemiconductordemand(drivenbydigitaltransformation).Moreoveraswecontinuetoincreasinghigherlayercountsandnodemigrations,thatdrivestheneedforcriticaletchanddepositionsteps(benefittingAMATandLRCX)andinspectionintensity(benefittingKLACandAMAT).Inadditiontostrongleadingedgeinvestments,mature/specialtysystemsbusinesshasalsobeenanareaofstrengthandoutgrowingoverallWFE.Servicessegmentscontinuetobestrongandgrowingoninstalledbasegrowthandsubscription-likeservicerevenueandprovidestrong/stableFCFgeneration.

Seecompany-by-companysummariesonthefollowingpages(inorderofpresentation).

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AMD

Stronggrowthin2021withdemandexceedingsupply.AMDraisedits2021growthtargetfrom+37%Y/Yatthestartoftheyearto+50%Y/Yatthemostrecentearningsasitsviewofsupplyhasimprovedwithexpectationsofmoresupplycomingonlineinthenextfewquarters.Nevertheless,demandexceedssupplythisyearandAMDhashadtoprioritizeshipmentsleavingsomesegmentsunderservedsuchaslower-endPCs.Inventoriesareleanthroughoutthesupplychain.

AMDpositioningfordatacenterofthefuturewithacomprehensiveheterogeneouscomputeportfolio-keybuildingblocksofCPU,GPUandFPGAs.AMDanticipatesgrowingrequirementsforadvancedcomputeworkloadsoverthenext5years.AMDhastheabilitytomix-and-matchwithitsadvancedCPUs,GPUsandFPGAs(ontracktocloseXilinxacquisitionbytheendof2021)andlinkingitwithitsInfinityfabric.AMDwillbelaunchingits2ndgenerationCDNAGPUbytheendof2021,withthetechnologyhelpingAMDwinafewlargeHPCopportunitiesandAMDseesroomforgrowthinAI/DL,cloudgamingandanalytics.WiththeadditionofXilinx,AMDcanbetteraddressnewmarketopportunitiesincommunications,industrialandautomotive.AMDwillpushtheenvelopeon2.5Dand3Dpackagingalso.

3rdgenerationEPIC(Milan)rampingand4thgenerationEPYC(Genoa,5nm)‘ontrack’for2022launch.AMDhasseenstrongadoptionofMilanattier1cloudcustomersandpercoreandTCOleadershiphashelpedgaintractionatenterprisecustomers.CustomersarerecognizingthatAMDisastrongpartnerandAMDisbuildingoutitsgo-tomarketandcustomersupportnetworktoaddressitsgrowingopportunities.4thgeneration(Genoa),whichwillbebuiltonTSMC5nmis‘ontrack’for2022launchandAMDsees‘lotsofcustomerinterest’.

RoomforARMinthedatacenter–butAMDwillfocusontherightarchitecturefortherightworkload.AMDhasexperiencewithARMarchitectureandconsidersARMapartner.AMDseesARMhavingaplaceinthedatacenterandAMDwouldconsidersupportingARMdesignsforcertainworkloads/customers,butbelievesthattheywillworkwithcustomersondeliveringtherightsolutionfortherightworkloadanditcouldbeeitherx86orARM-based.

Significantroomtogrowin2022and2023andthe$4Bsharerepurchaseprogramisasignofconfidenceinthebusiness.AMDbelievesitisstill‘veryunderrepresentedinthemarket’withsignificantroomtogrowoverthenextfewyears.LastweekAMDannounceda$4billionsharerepurchaseprogram.AMDhasbeenonamulti-yeargrowthstrategy.Businessperformancehasbeenstrongandevenwithsignificantinvestmentsinopex,AMDseesstrongcashflowgenerationthisyearandoverthenextfewyears.

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27May2021

Intel

2021PCdemandremainsstronganddatacenterdemandinflectingwithY/Ygrowthexpectedin2H21–supplyconstraints,includingoutsideofIntelholdingbackgrowth.IntelcharacterizedPCdemandasbeing‘onfire’andIntelisontracktorampnext-generation10nmAlderLakeproductsin2H21.Indatacenter,Intelbelieves1Q21waslikelythebottomandIntelseesenterprise,governmentandcloudcustomerdemandimprovingfromheredrivingY/Yrevenuegrowthin2H21indatacenter.IntelbelievesitsprogressionfromIceLaketoSapphireRapids(early2021)toGraniteRapidswillstrengthenitsdatacenterproductroadmapoverthenextfewyears.Amidastrongdemandenvironment,Intelisconstrainedbysubstratesanditscustomersarealsosupplyconstrainedforothercomponents.Asaresult,Intel’soutlookhasbeenmutedsomewhatfor2H21.

Focusedonexecutionacrossthebusinesswithsolid7nmprogress-first7nmproducton-tracktotapeoutthisquarter.Intelhasmadeleadershipchangesinprocesstechnologyandbroughtbackseniorleadersinotherpartsofthebusiness.Mr.GelsingercommentedthattheMeteorLakecomputetile(7nm)istapingoutandwebelieveIntelwillberunninginitial7nmpartsinpilotproductionbeforetheendof2Q.

Aimingtoregainsilicontechnologyleadershipthroughyearlycadence.Intelisdrivingmajorimprovementsinprocess(transistor,back-end,lithoscaling)andcore(‘big’and‘little’)technologieswiththegoalofachievingprocessparitywithTSMCandeventuallyreturningInteltoleadershipbythe2024-2025timeframe.Inadditiontoimprovementsinprocesstechnologies,Intelisbuildingonitspackagingtechnologies(e.g.EMIB,Foveros).

Renewedfocusonfoundrystrategywithbetterchanceofsuccessthistimearound–initialstronginterestinpackagingtechnology.IntelbelievestherewillbehigherdemandforitsfoundryservicestodaythaninthepastbasedoncustomerinterestinhavingdomesticsupplyattheleadingedgeandwithIntelopeningupitstechnologyportfolio,includingpackaging,toitscustomers.Intelisseeinginterestinhybriddesignsfromlargecloudcustomersandhasalmost100cloud,networkingandfablesscustomersaspartofitspipeline.Silicondesignscantake18monthsto2years(orlonger),whilepackagingdesignscanbebroughttomarketwithin6months.IntelisseeinginterestfromcloudandautomotivecustomersinusingIntel’spackagingtechnologiesinthenearerterm.

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HarlanSur

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27May2021

AppliedMaterials

Semiconductorequipmentdemandenvironmentstrongandlikelytoremainstrongoverthenextfewyears.For2021,AppliedMaterialsisseeingincrementallystrongerWFEgrowthledbyFoundry/LogicfollowedbyDRAMandNAND(inthatorder).AppliedexpectsFoundry/Logictogrowfasterthanmarketgrowth,DRAMrelativelyin-linewithmarketgrowthandNANDbelowmarketgrowthin2021.AppliedreiterateditsexpectationofWFEequipmentgrowthagainin2022andlikelytoremainstronginthefollowingyearsascapitalintensitycontinuestoincreaseacrossdevicetypesandwithcustomersprovidingmultiyearcapitalspendingroadmaps.Inaddition,mature/specialtycapacity,whichAppliedMaterialsaddresseswithitsICAPS(IoT,communications,auto,powerandsensors)segment,islikelytocontinuegrowingovertime(‘muchgreaterthan$3B’in2021.

CapitalintensitylikelytocontinueincreasingandApplied’sSAMandmarketsharelikelytoexpand.AppliedMaterialsseesa‘naturalupwardbias’tocapitalintensitydrivenbyitscustomersPPACt(power,performance,area,costandtime-to-market)requirements.Additionally,Applied’sservedavailablemarket(SAM),whichisfairlybalancedacrossdevicetypes,isexpandingandtheteamseesmarketshareopportunitiesinmultipleareasincludingwithintegratedsolutionsandacrossdevicetypes(e.g.high-kmetalgateandDracohardmaskinDRAM).OneareawhereAppliedseesexpandingopportunitiesisinadvancedpackaging(akeyenablerofPPACt)wherethecompanyseesrevenuesdoublingthisyearfrom2019levels.Specificallyforpackaging,Appliedhasthebroadestsetofunitprocessequipmentandintegratedsolutions(e.g.forhybridbonding)thatAppliedbelieveswillhelpthecompanyoutperformrelativetomarketgrowth.

Service(AGS)marginstoexpandinincreasingscale,highervalue-addproducts,includingthroughuseofAI,andgrowthofsubscription-likerevenue.AppliedexpectstodriveAGSoperatingmarginhigherinthecomingyearsasaresultofincreasedsubscription-likeservicerevenue,operationalefficienciesfromhigherscaleandbyincreasingthevalueofitsservicesoffering.Forexample,aspartofitsequipmentandserviceofferings,AppliedMaterialsisusingbigdataandAIthroughtheimplementationofbettersensorsandmetrologywithininitsprocessequipment,increasedcomputepowerinprocesscontrolandleadinge-beamtechnologyinordertohelpcustomersexpandprocesswindowsandreducetime-to-market.

Expandingcapacitytomeethigherdemand.AppliedMaterialshasincreasedcapex,addedheadcountandhasbeenworkingcloselywithitssuppliersinordertoaddressincreasingdemand.

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27May2021

ONSemiconductor

Near-termdemandremains“highandhealthy”andsupply/demandimbalanceextendingintoCY22.TheONSemiteamnotedthatdemandremainshighandhealthy,supplyremainstight,andinventorylevelsinthedistributionchannelswillremainbelowtargetrangefortheforeseeablefuture.Giventhestrongenddemandenvironmentandcontinuedsupplychainconstraints,theteamnotedthatdemandtrendedabovesupplyintheMar-QtrandisexpectedtotrendaboveintheJun-Qtr.Oncontinuedincreasesinmanufacturingcapacity,theteamseesthesupply/demandimbalanceeasinginthesecondhalfoftheyearbutwiththeimbalanceextendingintoCY22.Theautomotivesectorcontinuestohavethelargestsupply/demandgap.

Supplysideindicatorsremaintight;leadtimesare2xabovenormallevels.Distributioninventorylevelsof8.4weeksremainwellbelowthenormalrange(11-13weeks).Leadtimeshavestretchedoutandareat30-32weeks,2xabovenormallevels(15weeks)andappearingtostabilizeatthesehighlevels.RegardingtheMalaysiaCOVID-19partialshutdown,theteamhasbeenproactiveinmitigatingfactoryoutbreaks(testingsincetwoweeksago)andthefactoryisstillrunningbutatreducedoutputlevels,buttheteamhasbeenproactivelymovingcapacitytootherlocationsgivenitsflexiblemanufacturingmodel-webelievetheteamshouldbeabletonavigatethroughthiscurrentCOVID-19shutdowninMalaysiawithminimaldisruption.

Automotiveleadershipinpower/electrificationandsensortechnology;70%ofthebusinessshouldoutgrowSAAR–ONseesstronggrowthopportunitiesinADASandpower/electrificationandtheteamremainsconfidentinsustainingagrowthpremiumaboveproductiongoingforwardgivenitsstrongdesignwinpipelineandcontentuplift.Overalltheteambelieves70%ofthebusinessshouldoutgrowSAAR.ADASisastronggrowthdriverinautosasmorecontentisbeingdrivendownfromthehigh-endtomid/lowendandbyopportunitiesinelectricvehicles.InADAS,theteamhasroughly65%shareintheautomotiveimagesensormarketand80%+shareintheADASsub-segment.Aswemovetolevel2+andlevel3thenumberimagesensorspercarandnumberofcarswithsensorsareexpandingatarapidpaceandtheteamhasastrongdesignwinpipeline.TheteamiscurrentlybeingopportunisticonitsLidaropportunities.Electrification(EVvehicles)isanotherstronggrowthopportunityforONgivenitsleadershippositioninhighefficiencypowertransistors,IGBTpowertechnology,andsiliconcarbidebasedproducts.WhileEVasa%oftheautobusinessiscurrentlysmall,theteambelievesthiswillbeasignificantdriverasthedesignwinpipelineunfolds(over-indexedtoEV)overthenextfewyears.

Industrialgrowthdrivenbydiversifiedstrengthwithlongertermseculargrowthdrivers.ONseesbroad-basedstrengthinindustrialapplications(includingmedical)andwithseculartailwindsinfactoryautomationandalternativeenergysolutions.Machinevisionapplicationsforindustrial(30%ofitsimagesensordivision)continuingtopenetratemoreapplicationswithintheindustrialsegmentandtheteamexpectstheimagesensorbusinesstocontinuetogrowacrossallapplications.Nearterm,theteamisseeingthisareasupplyconstrainedbutisworkingdiligentlywithexternalfoundrypartnerstoalleviatethistightness.

Laserfocusongrossmarginimprovements.Theteamexpectsgrossmargintocontinuetoimproveinthesecondhalfoftheyeardespiteamoremutedrevenuegrowthprofileonself-helpinitiatives(operationalefficienciesandhigherutilization)andproductmixshift.Theteambelievesitcanmaintainan84%utilizationlevelsthroughtheremaindertheyear.Theteamexpectsproductmixshift(shifttowardshighervalueaddedproducts)andcost-outinitiatives(footprintconsolidation)tocontinuetostructurallydrivegrossmarginshigher.

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MaxLinear

Supplyconstraintsholdingbackrevenuegrowth;solidvisibilityinto2022onstrongbacklogandextendedleadtimes.MaxLinearissupplyconstrainedandwilllikelybeconstrainedintonextyear,thoughunlikemanysemiconductorpeers,MaxLinearseesmoreconstraintsintheback-end(substrates,lead-frames,etc.)vs.silicon.Theteambelievestheback-endconstraintsshouldbegintoeaseinthesecondhalfoftheyearasitbringsonmoresuppliers.Demandcontinuestoremainstrongwithsolidvisibilityinto2022onstrongbacklog(~15months)andextendedbutstabilizedleadtimes(~40-50weeks).Moreover,theteamnotedit’sdiligentlytryingtomitigatedoubleordering.

BroadbandandConnectivitydemandlikelytoremainsolidandMaxLinearwell-positionedtodriveabovemarketgrowthonfurthersharegainsandcontentgrowth.MaxLinearseesBroadbandandConnectivitymarketdemandremainingstrongthroughtheyear.InBroadband,MaxLinearseesfurthermarketsharegainopportunities,asitskeycustomersgainshareinthemarket.InConnectivity,whichincludesWi-Fi,Ethernet,MoCAandG.Hn,MaxLinearisconfidentdrivingcontentgainsandexpandingmarketshare.Theteamcontinuestoseesharegainsforthenext3-4quarters.Onthefiberside,theteamseesalongrunwayforsharegainsgiventhelowerpenetrationrate(2-3%ofthemarket).InWi-Fi,MaxLinearseescontentmorethandoublingwhenmovingfromWi-Fi6($12-$15)toWi-Fi7($40+).Theteambelievesithasastrongpositionin2.5Gbpsspeed,whichisgrowingataverysolidpace.ForotherConnectivityproductssuchasMoCAandG.hn,MaxLinearseesadditionalgrowthopportunitiesaswell.

StrongY/YgrowthexpectedinInfrastructureledbywirelessbackhaulandwirelessaccesswithPAM4alsocontributingin2H21.MaxLinearexpectscontinuedstrongdemandforwirelessbackhaulproductsthisyearwithmassiveMIMOtransceiversandPAM4DSPproductsalsorampingin2H21.MaxLinearsawthewirelessbackhaulbusinessreacceleratelastquarterandexpectscontinuedsolidgrowththroughtheyear.In5Gaccess,theteamrecognizedrevenuein1Q21andthatshouldcontinuetogrowinthe2H21and2022.TheteamexpectsthatNorthAmericandeploymentsshouldtransitionto64x64inthenext3-4years.PAM4DSPisback-endloadedthisyearandwillbeabiggerrevenuecontributorin2022.800GisexpectedtodrivegrowthintheoutyearsandMaxLinearplanstosharemoreonthetechnologyattheupcomingOFCconference.

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Qorvo

Managingsupplyconstraintswell;supply-sideindicatorsremainverytight.Qorvohasseenlongerleadtimesforsilicon-basedcomponents,butappearstobemanagingthesupplyconstraints.Reflectiveofthestrongdemandandtightsupplyenvironment,channelinventorylevelsareat“days”ratherthan“weeks”whileon-handinventorylevelsarealsosittingathistoricallows.Giventhesupply-constrainedenvironmentandfirmdemandenvironment,theteamisworkingonmulti-yearagreementsandisaddingincrementalcapacityeffi