Semiconductor chip stocks are trading higher Thursday after Samsung SDI (KS:006400) beat consensus earnings estimates.
Shares of AMD (NASDAQ:AMD) (+2.5%), NVIDIA (NASDAQ:NVDA) (+2.9%), Intel (NASDAQ:INTC) (+0.3%), and Taiwan Semiconductor (NYSE:TSM) (+1.7%) are gaining ground during the session.
Reacting to the Samsung SDI report, Bernstein analysts said the company's solid-state battery plans are getting closer to reality.
"Samsung SDI reported 2Q23 net earnings to parent of KRW461bn (+18% y-o-y, +5% q-o-q) which was 6% higher than consensus estimates of KRW434bn," explained analysts. "1H23 net earnings totaled KRW950 which is 43% of FY consensus estimates of KRW2.1tn and 40% of our KRW2.3tn. 2Q23 GPM came in at 18%. 2Q23 OPM came in at 7.7% (7.0% in 1Q23 and 9.0% in 2Q22), compared to consensus 7.4%."
"Energy storage business is expected to see sequential revenue growth and continued profit improvement through 2023 with ramp up of Gen 5 batteries," they added.
Analysts noted that SDI's development of solid-state batteries is progressing better than expected.
"Gen 6 (90% + Ni) batteries which are 10% higher energy density and lower costs than Gen 5 batteries, will start production in 2024. For 4680 battery cells, production line commenced in 1H23 and achieve performance target earlier than planned. All-solid-state battery production line was completed in 1H23, and mass market production expected in 2027," they wrote.