Replies to post #49083 on Savvy Trades and Investments

[cliffvb]

AMAT That softer Q2 guidance is caused by weaker high end smartphone and Nand chip demand which is mostly offset by strong Dram and server demand.
Of course investors react by hitting the sell button including MU.

From the AMAT CC:

While we are only at the very beginning of the buildout of the AI, big data era, we are already starting to see the positive impact on our markets. In just the past six months, cloud service providers have increased their capital investments significantly. Looking at the financial reports from the top seven cloud service providers, we see their CapEx up around 40% this year versus previous expectations of about 30%. Also, data center real estate investments made by those companies in 2017 were up more than 250% compared to 2016, which we view as a positive leading indicator of growth.
Data centers are already becoming a much larger consumer of silicon. For example, the market for server DRAM is currently growing about 75% faster than mobile DRAM, which means it could become the largest segment of the DRAM market in the next three to five years. In addition, the architecture war for AI leadership is heating up with a steady stream of new, high-performance computing hardware coming to market. At both the server and chip level, we see a major shift from general-purpose computing to new hardware architectures that are customized for specific computing tasks or workloads. This significant technology inflection is fueling new investments in hardware design and new silicon devices, which in turn are driving significant innovation throughout the ecosystem.
I’ll now translate these end market trends into an outlook for Applied’s served markets. As I mentioned, we are seeing extremely disciplined investment by our memory customers, which we believe bodes well for healthy market dynamics. In line with our previous forecast, NAND bit demand is expected to grow at about 40% this year. While we have reduced our expectations for NAND investments in 2018, we still see spending being similar to last year’s high levels.