Barclays analysts predict a significant boost for chipmakers and a faster-than-expected ramp for the upcoming 2nm chip manufacturing process.
"TSMC expects 2nm to be a 'very, very big' node," says Barclays, projecting positive implications for the entire semiconductor industry due to the increased demand for advanced tools and foundry capacity.
A key driver for this optimism is the shift in leadership from smartphones to datacenters. "Datacentre will become the driver" of leading-edge logic demand overtaking smartphones, Barclays observes.
This transition is expected to accelerate the adoption of 2nm chips, with Barclays estimating that "2nm could account for a third of Intel's capacity by the end of 2026."
This bodes well for Taiwan Semi (TSM), which Barclays sees as maintaining its dominant market share.
"Strong demand for 2nm should be positive for TSMC," they remark, raising their price target to $170 per share due to projected higher earnings.
Barclays also sees positive impacts for equipment manufacturers like Applied Materials (NASDAQ:AMAT) and Lam Research (NASDAQ:LRCX). The complexity of 2nm chip production creates "significant incremental opportunities" for these companies, who are already reporting revenue from GAA (Gate-All-Around) technology, a foundational element of 2nm chips.
The Barclays note paints a bright picture for the chip industry, with the 2nm node acting as a potential catalyst for growth. TSMC is poised to benefit the most, while equipment makers like AMAT and LRCX are expected to see a surge in demand for their advanced tools.