Irrational Analysis

Irrational Analysis is a newsletter focused on the semiconductor industry, providing detailed investment analysis through the lens of engineering and market dynamics. It covers trends, competitive analyses, and technical insights, while also commenting on financial impacts of developments in the semiconductor and technology sectors.

Semiconductor Industry Analysis Investment Strategies Technology Trends Market Dynamics Financial Analysis Company Competitive Analysis Product Development AI and Computing Technologies

The hottest Substack posts of Irrational Analysis

And their main takeaways

Dell Clown Fiesta

279 implied HN points • 01 Jun 24
💰 Finance Stocks Investing Semiconductors Earnings Markets
  1. Some investors exhibit group-think behavior, leading to irrational market actions.
  2. Investing in the semiconductor industry requires thorough research and understanding of the market dynamics.
  3. HBM/Micron presents a unique investment opportunity due to increased demand and supply constraints.

Dell Mega Leak Analysis

239 implied HN points • 15 May 24
🕹 Technology Analysis Semiconductors Leaks Market Share Batteries
  1. The Dell leak suggests Qualcomm's upcoming laptop chips have a base-case gross-margin of 52%, significantly benefitting $QCOM while posing challenges for $INTC.
  2. Qualcomm is dominating Intel in Bill of Materials (BOM) cost, with Dell still saving money even before subsidies, showcasing the impact of the PMIC fiasco on Intel.
  3. Qualcomm's laptops are expected to offer nearly double the real-world battery life compared to Intel's, showcasing a major market advantage in terms of battery life and potentially leading to substantial market share gains.

[GB200 NVL72] The Mainframe of Doom

339 implied HN points • 30 Mar 24
🕹 Technology Semiconductors Datacenters AI Graphics
  1. Nvidia's GB200 NVL72 poses an existential threat to competitors in the datacenter CPU market, offering a unique 2:1 ratio and improved integration perspective.
  2. The reintroduction of mainframes signifies a strategic move by Nvidia, with the new AI mainframe/appliance providing massive TCO advantages and performance gains.
  3. Jensen's benevolent trade offer complements technical excellence in the face of political challenges, aiming to secure Nvidia's position in the market and potentially disrupt the status quo.

NASDAQ:ARM is Comically Undervalued

159 implied HN points • 23 May 24
💰 Finance Investing Stocks Market Analysis Semiconductors Technology
  1. Irrational Analysis is heavily invested in the semiconductor industry, giving insights into the comical undervaluation of NASDAQ:ARM.
  2. Nvidia's massive demand for GB200 and Grace CPUs could have significant implications for ARM (LTD)'s value and future performance.
  3. Nvidia Grace CPUs might exceed sell-side expectations, potentially propelling ARM (LTD) value beyond current projections.

Elite X Hype, Mediocre Financial Impact

159 implied HN points • 27 Apr 24
💰 Finance Analysis Investing Stock Market Technology Semiconductor
  1. Qualcomm's market share in laptop/PC is expected to grow from less than 0.1% to 5% by CY 2025.
  2. The stock price of Qualcomm may not show significant movement as the potential market share gains are likely already factored in.
  3. Qualcomm's gain in market share is predicted to come at the expense of Intel, which is already facing numerous challenges in their core business.
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[Q1 CY24] Micron's HBM Party

219 implied HN points • 23 Mar 24
🕹 Technology Semiconductors Market Analysis Competitor Analysis
  1. HBM (High Bandwidth Memory) is a new and important type of DRAM that has gained significance in the industry for its relevance to AI.
  2. The DRAM market, volatile in nature, has seen Micron making gains in HBM and facing challenges from competitors like Samsung with poor HBM yields.
  3. Investors interested in the HBM market need to be cautious due to the market's volatility and the potential impact of competitors like Samsung on HBM gross margins.

Everything is (not) fine at Intel

159 implied HN points • 03 Apr 24
🕹 Technology Semiconductors Investment Analysis Engineering
  1. The Intel event highlighted concerning trends, particularly in product competitiveness and margins, with challenges in execution and manufacturing processes.
  2. Intel's strategic shift towards insourcing and reducing external foundry partnerships suggests significant changes in their manufacturing approach.
  3. Despite efforts to improve, Intel faces a tough road ahead with the need for advanced technology developments and a challenging competitive landscape.

GTC 2024 Keynote Irrational Recap

159 implied HN points • 19 Mar 24
🕹 Technology Semiconductor industry Cloud Computing Innovation
  1. The newsletter focuses heavily on the semiconductor industry and provides analysis based on public information and independent research.
  2. The author reflects on biases and encourages readers to form their opinions after reviewing the presented information.
  3. Jensen Huang from GTC 2024 Keynote introduces impressive innovations in the semiconductor field, like the RAS technology monitoring system and advancements in hardware design.

Ampere Computing is probably dead.

79 implied HN points • 20 May 24
🕹 Technology Semiconductors Tech startups Competition Market Analysis
  1. Ampere Computing is likely facing challenges as most of their customers have transitioned to other solutions.
  2. Despite unique product advantages, Ampere Computing is struggling as customers are moving to alternatives in the market.
  3. Lack of transparency on technical details raises doubts about Ampere Computing's innovation and competitiveness in the semiconductor industry.

Broadcom 2024 AI Infrastructure Day

99 implied HN points • 23 Mar 24
🕹 Technology Semiconductors Networking AI Tech Stocks
  1. Broadcom is heavily invested in the semiconductor industry, focusing on AI infrastructure, disclosing that opinions expressed are personal, based on public info and not financial advice.
  2. The market is transitioning to Network Interface Cards (NIC) being tiny computers with CPUs, logic, and accelerators, a shift away from Broadcom's current direction.
  3. Broadcom presents debates on Ethernet vs. Infiniband, criticizes Infiniband, and shares potentially misleading information, contributing to confusion in the market.

The Astera Labs Extinction Event

99 implied HN points • 10 Mar 24
🕹 Technology Semiconductors Connectivity Networking Hardware Software
  1. Astera Labs focuses on making "extender" chips called retimers, which enable design flexibility and cost savings by allowing the use of cheaper PCB materials.
  2. Understanding technical terms like SerDes, PCB stackup, signal integrity, loss, reflections, CTLE, DFE, jitter, adaptation, and CDR bandwidth is crucial in the semiconductor industry.
  3. Broadcom's recent product announcements have positioned them as a strong competitor to Astera Labs, showcasing superior power efficiency, compatibility, reach, and overall competitive advantages.

A Guide on Semiconductor Development

239 implied HN points • 02 Sep 23
🕹 Technology Semiconductors Design Verification Manufacturing Packaging
  1. Semiconductor development involves a complex process that can take 2-4 years to create a leading-edge chip, starting from digital design to post-silicon validation.
  2. Timing closure is a crucial step in the design process, ensuring that the delays of various circuit elements are aligned with reference clocks to optimize chip performance.
  3. Pre-silicon verification is essential before tape-out to catch physical design flaws that might impact the functionality and performance of the chip.

A Guide on Computer Architecture

99 implied HN points • 04 Feb 24
🕹 Technology CPU GPU Semiconductor
  1. CPUs are versatile and efficient in running various types of code, particularly excelling in handling "branchy" code with features like branch prediction, out-of-order execution, and speculative execution.
  2. GPUs are specialized for linear algebra tasks, such as those found in graphics processing, and though not as versatile as CPUs, they excel in speed and energy efficiency.
  3. ASICs are application-specific integrated circuits designed for particular functions, showcasing tasks like video encoding/decoding and cryptography with dedicated hardware blocks for efficient processing.

The Curious Case of NASDAQ:ARM's Low Float

79 implied HN points • 20 Dec 23
💼 Business Finance Technology Market Analysis Investment Strategies
  1. Masayoshi Son's involvement in ARM (LTD) through SoftBank and Vision Funds sheds light on the company's strategic financial structures.
  2. The low free-float of NASDAQ:ARM due to the private transaction between SoftBank and Vision Fund 1 raises concerns about the IPO valuation and the overall stock price.
  3. ARM's position in the embedded/IoT market faces challenges due to RISC-V competition and customers' trend towards vertical integration, posing a threat to ARM's dominance in this market.

AMD MI300X is not an AI chip.

99 implied HN points • 15 Oct 23
🕹 Technology Hardware Semiconductors AI
  1. AMD MI300X is not designed for AI workloads, despite the false narrative in the media.
  2. AMD's strategic decision to split GPU efforts into RDNA and CDNA families led to commercial success in gaming and datacenter markets.
  3. AMD's MI300X is optimized for high-precision compute and supercomputing, lacking in low-precision compute capabilities for AI workloads, putting them behind Nvidia until at least H1 2025.

[Q1 CY2024] Marvell and Broadcom

39 implied HN points • 08 Mar 24
🕹 Technology Semiconductors AI Networking Cloud
  1. Marvell and Broadcom both faced challenges after recent earnings, with Marvell experiencing a bigger drop due to exposure to the struggling 5G industry.
  2. The 5G technology's promised new use cases beyond smartphones have largely failed to materialize, leading to decreased demand and implications for companies like Marvell.
  3. Broadcom, on the other hand, showed strength in custom AI accelerators and networking revenue growth, positioning themselves well for the future.

Instruction Sets For Investors

99 implied HN points • 07 Oct 23
🕹 Technology Hardware Software Mobile Industry Innovation
  1. Instruction Sets are the crucial 'languages' chips understand for processing, and the owner and structure of the set impact the chip's handling of tasks.
  2. x86 processors from Intel and AMD are RISC machines beneath their CISC architecture, showing the historical significance of micro-ops.
  3. Distinct concepts define ARM: the corporation (ARM LTD), the instruction set architecture (ARM ISA), and real-time logic/reference designs (ARM RTL).

The Copper Chains Holding Cerebras Back

39 implied HN points • 27 Oct 23
🕹 Technology AI Hardware Semiconductor Data processing
  1. Cerebras, a unique AI-hardware startup, faces challenges in scaling due to copper chains and thermal density issues.
  2. They have developed proprietary technology to print wires across scribe lines, a unique capability in the semiconductor industry.
  3. Cerebras is selling systems for non-AI workloads like drug discovery and scientific research, but they need significant upgrades to compete with Nvidia.

[Q1 CY24] ARM Short Squeeze, Fabrinet Sus

19 implied HN points • 08 Feb 24
💰 Finance Stocks Earnings Investing Semiconductors Analysis
  1. ARM experienced a significant short squeeze after hours, showing wild price movement.
  2. Fabrinet's weak guidance and management's unconvincing excuses suggest something suspicious, leading the author to liquidate their position.
  3. Qualcomm showcased steady growth in the automotive semiconductor market despite challenges, with a rough response to questions about partnership details and future seasonality.

Intel's Terrifying Future

19 implied HN points • 27 Jan 24
💼 Business Technology Finance Investing Management Companies
  1. Intel's IDM model faces challenges in managing both chip design and fabrication under one company.
  2. Separating out P&L for design and fabrication units allows for increased accountability within Intel.
  3. Analysts are skeptical about Intel's future success, citing ongoing market share losses and competition from AMD, Nvidia, and others.

Mobileye's Rancid Kitchen Sink

19 implied HN points • 06 Jan 24
💼 Business Finance Technology Earnings Investing Semiconductor
  1. Mobileye's CFO actions hinted at potential manipulations with revenue and earnings data, raising concerns of corporate mismanagement.
  2. The preliminary financial outlook for 2024 revealed a significant decline in revenue that might continue for a few quarters, hinting at wider challenges in the automotive semiconductor market.
  3. Investors are advised to diversify into safer stocks, considering the uncertainties in the auto semi industry, with Mobileye's situation being a concerning outlier.

[Q4 CY23] ARM Special

19 implied HN points • 12 Nov 23
🕹 Technology Semiconductors AI CPU RISC-V Royalties
  1. ARM's royalty revenue faces challenges with declines in smartphone sales and RISC-V gaining share in embedded markets.
  2. AI trend shifts workloads from CPUs to specialized hardware, posing a challenge to ARM's value capture.
  3. ARM is expanding and investing in compute capabilities, but questions arise regarding the outcomes of these efforts, especially in the face of evolving industry dynamics.

[Q4 CY23] Ericsson, Nokia, Lam Research, Tesla, TSMC

19 implied HN points • 21 Oct 23
🕹 Technology Telecom Semiconductors AI Data Centers
  1. Analyst pointed out Ericsson's struggles with return to 2018 revenue levels and significant growth decline, raising concerns about pricing and cost-cutting efforts.
  2. Nokia's CEO indicated a challenging forecast with no recovery until 2026, expressing concern over irrational pricing actions by competitors in the market.
  3. TSMC CEO emphasized confidence in the company's advanced technology, dismissing the impact of edge AI on revenue growth in 2024.

An Introduction

19 implied HN points • 19 Aug 23
💰 Finance Investing Stocks Technology Analysis Newsletter
  1. The author shares their journey of pursuing their dream job of chip designing and how it led to their current obsession with semiconductors and investing.
  2. The newsletter 'Irrational Analysis' focuses on high-risk, high-reward investing with a strong emphasis on technology-driven investment analysis over traditional metrics.
  3. Transparency is vital to the author, who discloses all active positions and emphasizes that the newsletter's content is based on public information and independent research.

[V]ery [L]ong [I]ncoherent [W]riteup

1 HN point • 24 Feb 24
🕹 Technology Semiconductor industry Computer Architecture
  1. VLIW architectures are unique computer architectures with benefits like low power consumption, low latency, and area efficiency, but they come with a significant challenge for compilers, often requiring manual assembly coding by experts.
  2. Historically, VLIW architectures have a long and colorful history dating back to the early 1980s, including examples like Intel Itanium, Movidius/Intel, Xilinx/AMD, Qualcomm Hexagon, Google TPU, and Texas Instruments VelociTI, each with varying degrees of success and challenges.
  3. Groq, a company leveraging VLIW architecture, demonstrates the ongoing struggle with VLIW compilers, as highlighted through their efforts to optimize performance for a specific model, showcasing the complexities and limitations associated with 144-wide VLIW architecture.

[Q4 CY23] Intel, Lattice, AMD, Qualcomm

0 implied HN points • 02 Nov 23
🕹 Technology Semiconductors Tech Companies Market Analysis
  1. Intel had a stellar quarter with a significant prepayment from a major customer, and signed deals with additional customers for their latest technology. They divested a portion of their business and have strong momentum.
  2. Lattice faced significant challenges, potentially due to exposure to the Chinese market. They did not directly mention China in their communication, but it was evident through questions from an analyst.
  3. AMD showed mixed results with impressive products but flat revenue. They received great interest in a new AI chip from Microsoft with substantial revenue expectations, which caused significant stock movement.