Besi surpasses quarterly targets for AI-related chip part orders

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Besi surpasses quarterly targets for AI-related chip part orders
Besi surpasses quarterly targets for AI-related chip part orders

BE Semiconductor Industries (Besi), a chipmaking parts supplier, surpassed fourth-quarter targets, owing to increased demand for its hybrid bonding technology and AI-enabled computing applications as chipmakers expanded capacity

BE Semiconductor Industries (Besi), a chipmaking parts supplier, exceeded fourth-quarter objectives on Thursday due to rising demand for its hybrid bonding technology and AI-enabled computing applications as chipmakers expanded their capacity.

The Dutch group’s shares rose 12% in lunchtime trade, making it the third biggest gainer on the European benchmark STOXX 600 index, after reporting a 30% increase in quarterly orders led by hybrid bonding, a type of chip packaging necessary for AI applications.

Orders for the fourth quarter were 166 million euros ($180 million), with a portion of them likely to be shipped in the second and third quarters of 2024, the business reported.

Hybrid bonding orders nearly increased, with around half going to the group’s most advanced systems.

Besi’s clients, which include Nvidia supplier TSMC, Intel, and Samsung, have already started using its sophisticated chipmaking technologies.

Nvidia, the world’s largest contract chipmaker, also reported positive results and forecasts overnight, boosting shares of sector names such as Tokyo Electron, Aixtron, Infineon ASML, and ASM International.

According to Degroof Petercam analyst Michael Roeg, Besi’s investors are also reacting positively to Intel’s announcement.

This year, the assembly equipment manufacturer anticipates hybrid bonding and other sophisticated packaging technologies to increase even further.

In response, the Amsterdam-based group is expanding its operations beyond China, with investments in Malaysia, Singapore, and Vietnam. Some customers have also relocated their facilities outside of China, contributing to this trend.

Besi reported a gross profit margin of 65.1% in the fourth quarter, with revenue up nearly 30% over the previous quarter to 159.6 million euros.

This exceeded the company’s expectations for a gross margin of 62% to 64% and a quarterly revenue increase of 15% to 25%.

Besi anticipates a 5% to 15% decline in revenue from the previous quarter but a higher gross margin of 64% to 66%, thanks to sophisticated packaging goods.

“The slope of the recovery this year is uncertain given restrained demand for mainstream applications and weakness in automotive end-user markets currently,” CEO Richard Blickman said in a statement.

He stated that industry analysts anticipate a market comeback in 2024–2026, led by a recovery in mainstream assembly and Chinese markets, as well as increased capacity requirements for AI logic and memory applications and advanced packaging.

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