TSMC. Wow. The timing, the accidental timing perhaps of ASML, but it is important to think about how quickly TSMC comes because it's a continuation of the story, right? The investment cycle into AI, frankly, and whether we continue to see investment in chip equipment, making equipment, and the chips themselves. Joanne. Yeah. And you know, clearly TSMC has already released monthly numbers, so we have a good indication that their results are going to be solid and led by AI. And you know, the ASML news is more about, I think, China, particularly the pull forward in China for some of that equipment ahead of increasingly severe regulations against ASML shipping there. So 47% of ASML's business comes out of China, and that's going to have a big factor. You know, the fact that ASML did acknowledge that AI continues to be strong, but elsewhere things are weaker, you know, could reflect a number of things, starting with Intel and its

plans to delay some of its and cancel some of its overseas projects. For example, let's just dig in to how sad. As the CEO of ASML called it, the rest of the market is without AI, you know. Yeah. I mean, we've heard from plenty of the analog chip makers like Texas Instruments, for example, that autos is weakening and they don't know. They said, look, we don't know how soft this is going to become. Hasn't gotten severe yet, at least the last time we heard from them. But on the other hand, we also have heard that inventories have cleared in other end markets for semiconductors like industrials, and that we're starting to see a pickup there. So it's really hard to read ASML's comments about orders into the broader sort of move away from the leading-edge chip businesses like analog or microcontrollers. And that really is a sign those

companies, analog and microcontrollers really tell us more about the broader economy. And we know the U.S. economy is doing well. We know we're seeing recovery in industrial. So it's sort of hard to tell what SMI means. You know, how much of it is China, how much of it is Intel pushing out its plans. So it's actually not as straightforward a read, I think, as some people think it is. Let's give the nuance, therefore, because you're so good at doing that, Joanne, because this comes in the context of the breaking news that came on Monday that maybe we will see yet more and more, well, limitations on exports from the US and around the world to China. Nvidia chips, for example. Why was NVIDIA so sold off yesterday? If it's not around? How much of an importance is China us to some of these valuations? Yeah. You know, Nvidia shouldn't really have

sold off on the ASML news yesterday, particularly because ASML said this is nothing to do with Hey. All right. So I think what you're seeing is, you know, Nvidia is a big component of many ETFs. And so, you know, when you sell a lot of those ETFs, the money flows out, everything in them gets sold. So I think that was a big driver for NVIDIA. And then also, you know, you could see some folks saying, you know, let me get a little bit less exposure to the semiconductor space overall and given how much it's rallied, you know, that could just have been a decision made on diversification lines. But I think it's probably the ETFs that drove most of that. Joanne, remind us which of these names you like and hold which you don't and why. Yeah. So we're not involved in ASML, nor do we like Intel here because of its significant challenges.

We do like in video. We continue to like a number of players in the air space, including Broadcom. So, you know, overall, I think that the economically exposed companies like Texas Instruments, we own that for clients. I own it myself, I think is a good place to be given how strong the U.S. economy is and how much of a recovery we are seeing in industrials. Intel, you know, faces huge challenges to catch up in manufacturing, and it just doesn't have the expertise to do foundry work. It's a big challenge for them to build a library that it can then build other types of chips for. So, you know, the Qualcomm deal, if it goes through, we suspect will be more oriented towards Qualcomm trying to acquire the design side. And that could give Intel a massive cash infusion with which to save the manufacturing side and really make the investments that are necessary.

We think that's such a long way off and so uncertain that we don't think Intel is a place to be right now.

Investors Anticipate Chips Demand Amid ASML Selloff

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