Wafer intensity shifts from leading-edge logic and HBM will drive an upcycle for silicon wafer makers; expect 2028+ LTA ASPs 20% higher.
ASPs depressed for years but market turning higher; analogs TXN and STM show broader positive trends; 6M+ lead times on epi equipment constrain supply.
ASPs have been depressed for a few years, and LTAs lock in most pricing through 2027. The market is turning higher as well, you can see it in broader Analog reports like TXN and STM. We think these wafer intensity shifts, driven by leading edge logic and HBM, will drive a new upcycle for the raw silicon wafer makers, similar to the 2016-2017 upcycle (which was memory driven!). We expect negotiations for 2028+ LTAs to happen early next year, and see new Epi deals locking in ASPs 20% higher. (4/5)
| Horizon | Raw move | vs SPY |
|---|---|---|
| 1 day | -1.1% | -0.7% |
| 1 week | +6.1% | +3.8% |
| 1 month | +23.8% | +18.5% |
| 3 months | -4.8% | -7.7% |
| 6 months | — | — |