Goldman Sachs reiterates Buy on BESI and raises target price on AI and advanced packaging demand

Overview

This report is a company research and rating update from Goldman Sachs on BE Semiconductor Industries (BESI.AS). The core conclusion is that BESI continues to see stronger orders and customer engagement in AI infrastructure, hybrid bonding, wafer-level assembly, and CoWoS-type advanced packaging applications, supporting mid- to long-term growth expectations; however, hybrid bonding in memory, especially HBM-related applications, has not yet entered full production qualification, with cost, yield, and process precision remaining key hurdles.

Core views

Goldman Sachs reiterates its Buy rating on BESI and raises the 12-month target price from €318 to €325. Positive factors include 2Q26 orders above consensus expectations, a higher share of AI-related system orders, a broader hybrid bonding customer base, wafer-level assembly applications extending from core AI computing into logic, memory, CPO, and consumer devices, and gradually emerging demand for CoWoS-type panel-level packaging. The key caution is that adoption of hybrid bonding by memory customers remains in the evaluation phase, and full production qualification may take considerable time.

Analysis framework

The report analyzes the company based on 2Q26 operating data, order mix, management commentary on hybrid bonding and wafer-level assembly demand, third-party growth forecasts for the assembly equipment market, and Goldman Sachs' updated FY26-30 revenue, gross margin, EBIT, EPS, and valuation multiples. Valuation uses a 29x 2HCY27+1HCY28E EV/EBITDA multiple applied to the raised EBITDA forecast.

Methodology notes

• Valuation methodsEV/EBITDA target price methodology

  Derive the target price by multiplying a forward EV/EBITDA multiple by forecast EBITDA

  Goldman Sachs applies a 29x 2HCY27+1HCY28E EV/EBITDA multiple to its raised EBITDA forecast to derive a 12-month target price of €325; the previous target price was €318, and after rolling forward the valuation period, the multiple was adjusted from 33x CY27 to 29x.

• Factor analysisGS Factor Profile

  Relative percentile comparison across growth, financial returns, valuation multiples, and composite factors

  Goldman Sachs Factor Profile compares stocks against the market and industry peers using valuation metrics such as forward sales, EBITDA, and EPS growth, ROE, ROCE, CROCI, and P/E, P/B, and EV/EBITDA.

• M&A analysisM&A Rank

  A 1-to-3 tier score based on the probability of becoming an acquisition target

  Goldman Sachs uses an M&A framework across its global coverage to assess the likelihood of a company becoming an acquisition target; the report discloses the framework definition but does not show BESI's specific M&A Rank in this report.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• BE Semiconductor Industries (BESI.AS)

  Report subject and recommended name

  Strengths

  Higher share of AI-related orders, broader hybrid bonding and wafer-level assembly customer base, increasing contributions from CoWoS-type and photonics applications, and raised FY26-30 earnings forecasts.

  Weaknesses

  Memory hybrid bonding adoption remains in the evaluation stage, customer production qualification cycles may be long, and cost and yield hurdles are not yet fully resolved.

  Comparison

  Relative to the broader assembly equipment market, management believes BESI can grow faster due to its exposure to 2.5D/3D packaging and wafer-level assembly.

  Risks

  Customer spending cycle volatility, delays in hybrid bonding adoption, and intensifying competition.

• HBM/memory hybrid bonding ecosystem

  A potential growth driver for BESI but still in the qualification stage

  Strengths

  All three major memory makers are preparing for eventual adoption, with one progressing faster and potentially able to announce full production status in the coming quarters.

  Weaknesses

  Cost, yield, process precision, material, and integration issues remain the main qualification barriers.

  Comparison

  BESI noted that qualification with a major Taiwanese logic customer took more than three years to reach cost and yield thresholds, implying that Korean and U.S. memory customers may also require a long period.

  Risks

  Changes in JEDEC thickness requirements do not alter hybrid bonding's thermal and performance advantages, but the timing of qualification and mass production remains uncertain.

Key data

• 2Q26 revenue performance1% below Visible Alpha consensus, up 69% YoYYoY growth was supported by expanding AI infrastructure spending and a modest recovery in traditional mobile and automotive/industrial markets.
• 2Q26 operating profit1% above Visible Alpha consensusMainly driven by a more favorable product mix.
• 2Q26 ordersAbout €293mn, up 9% QoQAbove the Visible Alpha consensus of €249mn, mainly driven by demand in photonics and data center applications.
• Share of AI-related system ordersAbout 60% in 1H26 vs. about 50% in 1H25Indicates a rising contribution from AI-related demand in BESI's order mix.
• Number of wafer-level assembly customers15 in 2025, rising to 21 by end-2Q26Application scope expanded into logic, memory, CPO, and consumer devices.
• Assembly equipment market forecast53% growth in 2025-2028Management believes BESI's exposure to 2.5D/3D packaging and wafer-level assembly can enable it to grow faster than the broader market.
• FY26-30 revenue forecast revisionRaised by 1%-5%Reflects a broader hybrid bonding customer base and AI-driven demand.
• FY26-30 EBIT forecast revisionRaised by 4%-10%Reflects updated revenue and operating expense assumptions.
• FY26-30 EPS forecast revisionAbout 1%-9%Reflects the EBIT forecast revision and changes in the latest share count assumptions.
• Target price€325, previous €318Based on a 29x 2HCY27+1HCY28E EV/EBITDA multiple.

Impact & implications

The investment implication for BESI is positive: AI infrastructure and advanced packaging demand is expanding from a single AI accelerator use case into data centers, consumer CPUs, high-end notebooks, potential premium smartphones, CPO, chiplets, and panel-level CoWoS-type applications, broadening BESI's addressable market and improving medium-term earnings expectations. However, the adoption pace of memory/HBM hybrid bonding could still lag market expectations, as cost, yield, material integration, and process precision issues need to be resolved before production qualification.

Risks

• Cyclical volatility in customer capital expenditures and semiconductor equipment demand.
• Delays in adoption and qualification of hybrid bonding, especially in memory/HBM.
• Cost, yield, process precision, material, and integration issues preventing customers from entering mass production.
• Intensifying competition in advanced packaging equipment markets could pressure growth or valuation.
• Uncertainty around the pace of customer investment in CoWoS-type panel-level packaging and wafer-level assembly applications.

What to watch

• Whether any major memory customer announces full hybrid bonding mass production status in the coming quarters.
• Whether the share of AI-related system orders can continue to stay at or above the roughly 60% level seen in 1H26.
• Whether the contribution of CoWoS-type orders increases further in subsequent quarters.
• Whether the number of wafer-level assembly customers and application scope continue expanding into more logic, memory, CPO, and consumer device scenarios.
• Whether the FY26-30 revenue, EBIT, and EPS upgrades are validated by subsequent orders, revenue, and gross margin performance.