Tokyo Electron has tempered expectations despite an AI-driven boom, as evidenced by a less-than-anticipated increase to its annual forecast. This cautious outlook reflects the impact of export restrictions and China's efforts to establish its own domestic chip supply chain. While the company's recent operating profit exceeded expectations, its full-year operating profit forecast fell short of analyst predictions.
Despite the AI sector's rapid growth and significant investments from companies like OpenAI and Meta Platforms in advanced chips, Tokyo Electron faces challenges. These include export limitations on advanced chip manufacturing equipment to China and the country's support for local chip companies.
Tokyo Electron's performance lags behind competitors such as Advantest, even with a 35% stock increase this year. This highlights how geopolitical risks and reliance on specific customers can create vulnerabilities, while strategic agility and diversification are key for sustained growth in the AI era.
