Front-end semicaps: Raising forecasts on strong WFE backdrop

Research evidence excerpt

Front-end semicaps: Raising forecasts on strong WFE backdrop

24 July 2026

Front-end semicaps EquitiesSemiconductors &

Equipment

Raising forecasts on strong WFE backdrop Global

◆ WFE stays stronger for longer: we lift CY28 WFE estimate to Adithya Metuku*, CFA

USD272bn (+25% YoY, from USD261bn) post ASML’s results Senior Global Technology Analyst

HSBC Bank plc

adithya.metuku@hsbc.com

◆ Reflecting the strong WFE backdrop, we raise our estimates for +44 203 268 2960

ASMI, LRCX, and AMAT Kalpesh Mahadik*, CFA

Associate

◆ We remain constructive on fundamentals into results; maintain Bangalore

our ratings and raise our TPs for ASMI, LRCX, and AMAT

* Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is

not registered/ qualified pursuant to FINRA regulations

Raising estimates on higher WFE estimates: We recently raised our WFE estimates in

ASML Holding: From DRAM tailwinds to foundry upside, 12 Jul 2026. Since then, ASML

noted its intention to raise EUV and ArFi tool capacity by 30% in 2027 while investigating

a further c30% increase in 2028, suggesting WFE demand strength into 2028 may be

stronger than we previously anticipated. We therefore lift our CY28 WFE forecast to

USD272bn (c+25% YoY) from USD261bn (c+20% YoY). We maintain our 2026-27 WFE

estimates while we await further clarity over the upcoming earnings season. Reflecting

our WFE revisions from 12 July and in this report, we raise our estimates for ASMI,

LRCX, and AMAT. Into upcoming results at these companies, we see upside risk to VA

consensus estimates and remain constructive.

ASM International: We lift our 2026/27/28 revenue estimates 3.2%/4.4%/21.7% and adj.

op. profit estimates 5.2%/9.0%/29.7%. Our 2026/27/28 revenue estimates are

5.4%/14.5%/23.5% above consensus and adj. op.