Citi Global TMT Conference: Simulated chip dawn Bets on Analog Devices, Inc. (ADI.US) rebound Microchip Technology Incorporated (MCHP.US) as the top choice.

Citigroup recently held a global TMT conference and issued comments on the outlook for the semiconductor industry and individual stocks. The bank stated that the situation in the analog chip industry is not as bad as perceived, with recent increases in artificial intelligence orders. It is expected that Analog Devices, Inc. (ADI.US) will perform well, and there is also interesting data related to dynamic random-access memory (DRAM) from HP Inc. (HPQ.US). Citigroup attended multiple presentations at the global TMT (technology, media, and telecommunications) conference. The discussion in the analog chip sector has been the most controversial so far, with Infineon being cautious about the outlook for the 2026 fiscal year, hinting that the market expectations do not include factors such as international tariff policies and price wars. ON Semiconductor Corporation (ON.US) stated that order levels remain stable, while Ansemie reported that business remains stable and follows seasonal patterns, benefiting from an increase in market share in the automotive terminal market. The bank expects a rebound in Ansemie's stock price, which had previously fallen due to comments from Infineon. Analog Devices, Inc. is expected to make positive comments at this conference following last month's performance outlook. Compared to the conflicting views of other analog chip companies, Analog Devices, Inc.'s relatively optimistic outlook is expected to lead to strong stock performance in the short term. HP Inc. stated that storage chip prices have increased, and to counter rising costs, the company made inventory purchases in the first half of 2025 (1H25). The bank's top investment target remains Microchip Technology Incorporated (MCHP.US) as the company's performance is believed to have the greatest potential to exceed expectations. Other companies receiving "buy" ratings include Texas Instruments Incorporated (TXN.US), Broadcom Inc., Micron Technology, Inc. (MU.US), Analog Devices, Inc., and NXP Semiconductors NV Semiconductor (NXPI.US). The industrial terminal market appears to be the strongest sector, while the automotive terminal market remains weak Although there are differences in statements from various analog chip companies, data shows that the industrial terminal market is the strongest and exceeds seasonal levels, while the automotive terminal market is the weakest and below seasonal levels. The bank believes that this phenomenon is the core reason for the varying performance of businesses. Research shows that the recent increase in artificial intelligence orders will benefit AMD and Broadcom Inc. The bank's research shows a significant growth in demand in the artificial intelligence sector. During the earnings season, industry capital expenditures increased by $18 billion in 2025 (C25) driven by expectations from Microsoft Corporation (MSFT.US), Meta (Meta.US), and Alphabet Inc. Class C (GOOGL.US). This trend is expected to create performance upside for AMD and Broadcom Inc. Interesting data on dynamic random-access memory (DRAM) The bank stated that DRAM prices in the second half of 2025 are strong but with some inventory build-up. HP Inc. noted that storage chip prices have increased and expects this trend to continue in the second half of 2025 (2H25). The company has responded to rising costs by purchasing inventory. Microchip Technology Incorporated (MCHP.US) is the bank's top investment target The bank has listed Microchip Technology Incorporated as its top investment target as the company has seen the largest decline in sales and profit margins from peak levels, and the bank believes that it has the greatest potential to exceed performance expectations. Other companies receiving "buy" ratings include Broadcom Inc., Analog Devices, Inc., Micron Technology, Inc., NXP Semiconductors NV Semiconductor, and Texas Instruments Incorporated.