Bernstein establishes an architectural hierarchy framework from on-chip SRAM to shared storage, noting that AI workloads are divided by compute, bandwidth, capacity, or latency constraints: inference prefill is compute-bound, while decoding is memory-bound because the KV cache grows with token count and concurrent users. Expanding context windows and RAG datasets will increase demand for DRAM, SSDs, HDDs, and new intermediate tiers.

Bernstein evaluates several emerging storage paths: HBF, led by SanDisk and SK hynix, aims to supplement HBM with NAND but faces difficulty bridging the performance gap; Samsung's zHBM faces thermal and hybrid bonding yield risks; NVIDIA's NVHBM could reshape supply chain value distribution, weakening traditional memory suppliers' bargaining power on base dies; PIM offers theoretical efficiency advantages, but ecosystem restructuring costs limit near-term penetration.

Goldman Sachs tracking shows South Korea's 8-month memory chip exports rose 290% year-on-year, with DRAM exports up 412%, the fastest pace since 2008. DDR4 spot prices carry a 43% premium over contract prices, and DDR5 carries a 16% premium, indicating solid near-term support for memory pricing. Meanwhile, Goldman Sachs is more positive on HBM, raising its forecast for SK Hynix's 2027 HBM pricing growth from 50% to 100%, implying 2027 HBM operating profit of USD 500 billion.

Goldman Sachs notes TrendForce raised its 3Q26 PC DRAM price growth forecast to +18–23% sequentially, with server DRAM maintained at +13–18%. However, affected by elevated customer inventories, mobile DRAM is expected to grow only 8–13% sequentially in 3Q26 and slow further in 4Q26, showing clear structural divergence.

Goldman Sachs found divergence through HBM material import proxy indicators: plastic film imports related to Samsung Electronics rose 134% year-on-year in 7, while epoxy resin imports related to SK Hynix fell 18% year-on-year, interpreted as a clear recovery in Samsung's HBM competitiveness.

JPMorgan believes agentic AI inference has replaced training optimization as the primary focus of chip design, with inference increasingly decode-dominated and constrained by memory bandwidth. It expects commercial GPUs and custom AI ASICs to coexist as complementary parts, with custom designs suited for scaled workloads while NVIDIA and AMD platforms remain general-purpose choices.

Morgan Stanley expects Broadcom's 7-month quarter AI revenue to be USD 160 billion (up 48% sequentially), reaching USD 212 billion in the 10-month quarter, and sees upside potential in its approximately USD 1200 billion 2027 AI revenue forecast. Morgan Stanley also notes that NVIDIA and Alphabet's participation in MediaTek's USD 39 billion overseas convertible bonds strengthens ASIC collaboration, with proceeds to be used for HBM and ABF substrate procurement and wafer foundry capacity prepayments.

Goldman Sachs tracking shows SMCI provided FY27 revenue guidance of USD 650-720 billion (up 75% year-on-year), with F4Q orders exceeding USD 600 billion, of which about 70% relates to pure AI/GPU servers. Dell's F2Q27 AI server orders reached USD 609 billion, with a backlog of USD 950 billion; Goldman Sachs raised its F2027-29 EPS forecasts by an average of 38% and lifted its target price to USD 570.

Bank of America believes AI server deployment extends to optical transceivers, power capacitors, and semiconductor process chemicals, favoring Japanese suppliers such as Dexerials, Nichicon, and Kao. Goldman Sachs expects Luxshare's optical module capacity expansion to be 5-6 months faster than anticipated, with Vietnam lines ready in 3Q26, and AIDC, automotive electronics, and edge AI devices driving a 2025-28E revenue CAGR of 24%.

At SEMICON Taiwan, Morgan Stanley noted that testing is the key obstacle to mass production of silicon photonics and CPO, with ficonTEC planning to ship 1,000 systems over the next 1-1.5 years. HSBC initiated coverage on Robotechnik with a Buy rating, believing its acquisition of ficonTEC marks a transition to high-margin photonic manufacturing equipment, with optoelectronics business backlog reaching RMB 24.52 million, and expects 2027 to be the earnings inflection point.

Goldman Sachs expects 2026 WFE growth of about 35%, with the overall upcycle lasting at least until 2028, positioning Applied Materials and Lam Research best. EDA vendors such as Cadence will benefit from the proliferation of custom chips, facing an annual agentic AI opportunity of about USD 37 billion by 2030. BOE is expanding into glass-based advanced packaging, optical interconnects, and perovskite photovoltaics.

Morgan Stanley views Iluvatar CoreX's 1H26 gross margin miss (17.2%) as a short-term strategic investment to enter large CSP supply chains, maintaining its Overweight rating. Morgan Stanley believes MetaX C600 series shipments drove revenue growth, but gross margins missed expectations due to inferior energy efficiency from being based on the N+1 node combined with rising HBM costs.

Goldman Sachs believes AIDC power supplies represent an opportunity driving Megmeet's structural transformation, expecting AIDC power supply revenue to reach RMB 52 million in 2027E, accounting for 41% of total gross profit, though near-term domestic demand and margin pressure constrain earnings.

Bernstein notes that Montage Technology's 2Q26 net profit attributable to shareholders beat expectations mainly driven by investment income and fair value change gains, while gross margin fell 797 basis points sequentially to 61.8% due to rising wafer costs and a higher proportion of low-margin products, prompting investors to focus on core earnings quality.

Both Bernstein and Goldman Sachs emphasize that Montage Technology is accelerating new product development, including DDR5 Gen6 RCD sampling, PCIe Gen6 retimers, and tape-out of the CXL MXC Gen3 mass production version, supporting its multi-year growth trajectory, with revenue sources expected to expand from memory interface chips to broader data center interconnect products.

Morgan Stanley notes that Silergy's 2Q26 revenue rose 45% year-on-year to RMB 15 million, primarily driven by accelerating volume ramp-up in AI and optical module demand and recovery in industrial and automotive end-markets, but consumer analog chips remain under pressure, and a 2026 forward P/E of about 83x leads institutions to maintain an Equal-weight rating.

Goldman Sachs believes Alibaba has multiple funding sources for AI investment, including roughly USD 250 billion in annual cash generation from core e-commerce and cloud business margin expansion. Management believes AI infrastructure investment has a clear 3-year payback path and is confident in achieving RMB 300 million in MaaS annual recurring revenue in FY27 and USD 1000 billion in external cloud revenue in 2030.

Goldman Sachs tracking shows Z.AI's 8-month ARR exceeded USD 16 billion, with the latest weekly run rate annualized at USD 20 billion, raising its year-end 2026 ARR forecast to USD 27 billion. Unit token inference costs have fallen 80% year-to-date, and the compute monetization multiple has improved 14x year-on-year, but near-term earnings visibility is limited due to high R&D spending, maintaining a Neutral rating.

Goldman Sachs notes Kingsoft Cloud's 2Q26 AI cloud revenue rose 82% year-on-year to RMB 13 million, accounting for 43% of total revenue, the highest AI revenue contribution among Chinese cloud service providers, with GAAP EBIT turning positive for the first time in 2Q26. Range Intelligent's AIDC became a business contributing more revenue than traditional IDC for the first time in 1H26, with a gross margin of 45%, far exceeding peers.

Goldman Sachs analysis indicates MiniMax's enterprise customers account for about 80% of revenue, benefiting from expanded adoption by Chinese internet companies and overseas. Monetization is being driven through an open-weight strategy and the Harness product, and gross margin is expected to improve sequentially in 2H as inference optimization progresses, maintaining a Buy rating.

Citing Ramp Economics Lab data, Bernstein notes that U.S. enterprises heavily adopting AI grew their headcount by more than 10% on average compared with low adopters, countering concerns that "AI inevitably leads to white-collar layoffs." Enterprise customers still prefer per-seat software pricing models, and if AI drives hiring, the burden of this model will ease.

Goldman Sachs trackers show 22.4% of U.S. enterprises use AI in daily operations, and 40% of organizations have begun deploying and scaling AI agents. Academic research indicates AI delivers an average labor productivity improvement of about 23%, but there is no relationship between firm-level AI exposure and margin growth, suggesting dividends flow more to growth than to profits.

Goldman Sachs mapped Japan's IT services industry through Simplex HD and Dentsu Soken results, finding strong demand for financial sector IT spending and AI implementation consulting. However, Simplex faces short-term trade-offs as it fully advances AI-driven development, with first-quarter productivity gains exactly offset by AI token costs.

Bernstein expects Meta's ad revenue to surpass Google Search for the first time in 4Q26, earlier than the consensus expectation of 3Q27. AI has simultaneously driven both ad impressions and prices higher—"volume and price rising together"—with Meta capturing nearly half of incremental digital ad revenue in 2Q26, increasing its market share by 2.0 percentage points year-on-year.

Bernstein notes that although digital advertising fundamentals are at multi-year highs (the 1H26 basket grew 21% year-on-year), platform stocks have underperformed as investors worry about unprecedented AI infrastructure capex and free cash flow pressure. In contrast, e-commerce platforms have enjoyed improved conversion while bearing lower costs, significantly outperforming ad stocks year-to-date.

Morgan Stanley believes Meta agreed to pay up to approximately 170 hundred million USD within 10 years to settle social media addiction claims; since teenagers' average daily usage is under two hours and related revenue accounts for only about 1%, the direct operational impact is limited. The report analogizes this to Alphabet's path of intensively launching products after a judicial ruling in 2025 and achieving roughly 40% valuation expansion, believing the settlement could become a catalyst for accelerating the release of its product pipeline, with potential products collectively possibly adding more than 10 USD to EPS.

Morgan Stanley notes that Meituan's 2Q26 recovery is progressing, with food delivery unit economics rebounding to a positive 0.26 RMB per order, and CLC operating profit growing 52% year-on-year, beating expectations. However, due to seasonal rider costs and competition, it expects 3Q unit economics to decline to 0.1 RMB.

Bernstein believes the market may be overly interpreting Kevin Warsh's remarks on inflation as traditional forward guidance, whereas his speech actually questioned the sustainability of the Fed's forward guidance regime. A less communicative Fed would lead to a wider range of policy outcomes and cause more volatile pricing in prediction markets. After Warsh's hawkish remarks, US front-end rates were repriced to imply about 1.5 rate hikes before year-end, and Kalshi-implied probability of a 9 rate hike rose to about 55%.

Nomura's US economics team's base case remains holding rates steady, but it is highly sensitive to recent inflation data. Nomura believes that against the backdrop of a potentially more hawkish Fed, Asian interest rates will not uniformly outperform US rates, preferring markets that have completed tightening or have local technical support (such as South Korea and Hong Kong), while warning that markets approaching their first rate hike (such as India) may underperform.

Bernstein maintains its structural currency debasement trade view, believing that record US debt and unsustainable fiscal deficits will ultimately prompt policymakers to choose currency debasement, providing structural support for demand for Bitcoin as a hard asset. Although Bitcoin fell about 3% from the previous week's high due to Warsh's hawkish remarks, Bitcoin ETFs recorded inflows of about 30 hundred million USD over the past two weeks, the strongest trend so far in 2026. Stablecoin issuers have become the 18th largest holders of US Treasuries and are an important channel for absorbing new short-term Treasury bill supply.

Goldman Sachs expects China to introduce a policy package to steadily shift commercial housing sales from pre-sales to completed property sales, extending the maximum mortgage term from 30 years to 40 years, with repayments starting only after home delivery. It expects short-term land sales to weaken further, but long-term benefits for healthy housing market development and developer consolidation.

Goldman Sachs expects global real GDP growth in 2026 to slow to 2.5% year-on-year, dragged down by higher energy prices triggered by Middle East conflicts, with global core inflation at 2.8% by year-end. US real GDP growth in 2026 is 2.0%; the AI boom should support economic activity through higher equity wealth and strong capital expenditures, and the Fed is expected to keep the policy rate unchanged at 3.5-3.75% for the remainder of 2026. Eurozone real GDP growth in 2026 is 0.8%, and the ECB is expected to raise rates by another 25 basis points in 9.

Goldman Sachs expects China's real GDP growth in 2026 to slow from 5.0% in 2025 to 4.6%, with domestic demand remaining the core constraint and the real estate market yet to bottom out. The augmented fiscal deficit will reach 11.5% of GDP, and reflation will be driven by costs rather than demand, with PPI inflation expected to rise from -2.6% to 2.0%. Nomura notes that the rise in China's official manufacturing PMI to 49.8 in 8 mainly reflects seasonal distortions, the non-manufacturing PMI held at 49.0, and the construction PMI fell to a post-pandemic low of 46.9, maintaining its Q3 GDP growth forecast of 4.3%.

Goldman Sachs believes Asia FX performance this year is primarily determined by each economy's exposure to the AI and tech investment cycle, with currencies linked to semiconductor and tech exports (KRW, TWD, SGD, and MYR) outperforming higher-yielding currencies with lower tech exposure. KRW has risen 12% against the USD since 7, and South Korea's current account surplus in 2026 is expected to reach a record 4000 hundred million USD. It remains bullish on CNY, revising its 12-month USD/CNY forecast to 6.40. PHP is the clearest bearish view.

Goldman Sachs raised its year-end 2026 forecast for the 10-year Japanese government bond yield from 2.5% to 3.0%. Japan's consumer confidence index improved for the fourth consecutive month in 8 to 35.5, but the one-year-ahead expected inflation rate fell from 4.55% to 4.15%, attributed to households lowering price expectations after the government decided to cut the food consumption tax rate. South Korea's proposed 2027 budget shows the consolidated budget balance is expected to turn into a surplus, the first since 2018.

Goldman Sachs notes the S&P 500 index currently trades at 20x forward 12-month P/E, with earnings rather than valuation expansion driving the market, and the median company achieved 14% EPS growth in 2Q26.

Morgan Stanley notes that major baijiu companies' 2Q26 results declined more deeply than market consensus, with revenues of Shanxi Fenjiu, Gujing Gongjiu, and Wuliangye all falling, and sales expense ratios generally rising sharply to drive terminal retail sales. It expects a low base to push year-on-year growth to rebound in the second half of 2026, but this is more of an improvement in apparent growth; a true inflection point for sustained recovery still requires time, and mid-to-low-priced products may perform better than high-end ones.

Morgan Stanley found that large state-owned banks led the improvement in China's banking sector in 2Q26, with revenue growing 9.2% and pre-provision operating profit growing 13.0%, significantly higher than the 2.7% and 4.0% of other banks. Stronger earnings, mild NIM stabilization, and improved returns on capital support further rerating.

Morgan Stanley emphasizes that earnings divergence among small and medium-sized banks is widening, with retail credit quality (especially credit cards) being the main source of pressure; banks with lower provision coverage ratios such as Everbright, Huaxia, and Minsheng have profits that are more sensitive to credit stress.

Morgan Stanley believes the current US cycle shows divergence: industrial activity remains robust, supported by AI investment, reshoring manufacturing, and fixed asset spending, but residential and consumption-related areas provide significantly weaker evidence. It warns that imports in 7 were significantly above trend for the fifth consecutive month, as customers may be using the tariff window to build channel inventory and place orders early, which amplifies current industrial activity while increasing the likelihood of subsequent inventory corrections.

Morgan Stanley notes that inventories at residential HVAC distributors are at historical highs, and if demand does not accelerate significantly, another round of distributor destocking could be triggered in 2H26 or 2027; Carrier is the most sensitive due to third-party distribution accounting for as much as 90%.

UBS uses the Nikkei/TOPIX ratio (NT ratio) as a proxy for AI sentiment; the ratio retreated after hitting a historical high of 18 in 6 2026, indicating highly concentrated AI positioning in Japan. Data shows Kioxia's crowding score is 16.2, the highest since its IPO, and realized volatility on 100 reached 118%, implying AI and semiconductor stocks face further position-driven unwinding risks.

UBS notes that over 70% of Japanese companies beat quarterly earnings expectations, and shareholder return announcements are on track for a record annualized pace, which, combined with a high dispersion environment, supports active stock selection and individual stock catalyst mining.

Bernstein believes US EO 14420 increases regulatory uncertainty for Sungrow's utility-scale inverter and energy storage businesses, but historical experience suggests the ultimate impact may be far smaller than initially feared, with the base case still being enhanced scrutiny rather than a complete sales ban. It estimates that if completely exiting the US market, group revenue would fall by about 20.5%, gross profit by about 27%, and DCF value from 151 yuan/share to 96 yuan/share. Goldman Sachs notes Sungrow's 2Q26 revenue fell 37% year-on-year, missing expectations, but a higher proportion of overseas sales improved gross margin, supporting net profit beating expectations by 6%.

Goldman Sachs tracking shows the US transformer market remains tight, with PPI rising 7.6% year-on-year in 7; it expects the demand-local supply gap to narrow from the current 72% to 63% by 2028E, but shortages will persist. Goldman Sachs believes the Large Power System executive order is not a blanket ban, estimating Siyuan's revenue contribution from the US at 6%-7%, with behind-the-meter orders accounting for the majority, limiting the direct impact on overall earnings.

Goldman Sachs' analysis of Kehua Data's 2Q26 results notes that data center product sales growth recovered from -5% in 1Q to +30%, but a higher proportion of hyperscaler customers is expected to push 2H26E gross margin down to 28%.

Morgan Stanley emphasizes that Wuxi Lead Intelligent's 2Q26 new orders exceeded 90 billion RMB (up over 40% year-on-year), and management expects the current battery equipment upcycle may last 3-5 years. Nomura maintains its Buy rating but notes overseas material and freight costs are compressing gross margins, cutting the target price from 73 yuan to 44 yuan.

Morgan Stanley maintains its Overweight rating on Mindray Bio-Medical, which achieved over 10% growth against the backdrop of negative growth in China's IVD market in 1H26, and raised its total laboratory automation order target to 500 units.

Morgan Stanley believes the humanoid robot industry is shifting from showcasing locomotion capabilities to commercialization driven by production efficiency. Global shipments in the first half of 2026 reached 19,000 units (up 272% year-on-year, with China accounting for 97%), and China's 2026e shipments are expected to be 50,000 units. Robot "brains" and data remain global bottlenecks; Figure plans to invest over 10 hundred million USD in data and computing power over the next 12 months, expecting global cumulative adoption of about 10 hundred million units by 2050, with annual revenue reaching 7.5 trillion USD.

Bernstein reiterates its Outperform rating and 248 USD target price on SpaceX. Starlink's enterprise business continues to grow in aviation, with the number of contracted airlines reaching 46. SpaceX has completed the acquisition of Cursor to enhance programming capabilities, and the Louisiana Starbase is planned to cover 125,000 acres, expected to support about 10,000 launches by 2031, consistent with the company's forecast of launching about 50 GW of orbital data center capacity.

Morgan Stanley notes that BOE's and TCL's core business profits in 2Q26 both missed expectations, with BOE's gross margin falling to 14.5% reflecting pricing pressure in the smartphone display business, and TCL's revenue coming in 11% below expectations. It expects display business momentum in 2H26 to be weaker than seasonal norms, as restocking already occurred in 1H26. Morgan Stanley maintains its preference for BOE over TCL, citing scale advantages and faster progress in glass core substrates.

Morgan Stanley's analysis of Japan's 7 trade statistics notes that although export values of fiber optic connectors and optical fibers/cables retreated from record levels in 6, both remained at the second-highest levels historically. Cross-interconnection for AI servers requires several times the usual level of connectors, driving strong demand, maintaining its Attractive view on Japan's wire and cable industry.

Goldman Sachs notes that multiple Japanese banks raised mortgage rates in 9, with MUFG Bank and SMBC both raising floating mortgage benchmark rates by 25 bp month-on-month, reflecting the potential positive impact of Japan's interest rate normalization process on bank net interest margins. Meanwhile, intensifying deposit competition may partially offset the margin improvement brought by rising loan rates.