Win Semi Earnings: Clearer Data Center, Automotive, Satellite Outlook Outweighs Competition Concerns

We retain our fair value estimate of TWD 245 for Win Semiconductors after we pushed back revenue contribution from the now-paused Kaohsiung cluster by a year and factored in a modest contribution from optical components. Even though we have significantly cut 2025-27 forecasts, our unchanged fair value estimate reflects our view that the Kaohsiung cluster will eventually be a large contributor in the long term. Win Semi is undervalued in our view as the market seems to be reassessing the extent of smartphone recovery, and is overly concerned about intensifying competition. We believe improving smartphone-related data, and the resumption of the Kaohsiung cluster works are key catalysts to the share price.