Besi falls 9.5% after UBS downgrades to 'sell' on hybrid bonding risks
BE Semiconductor Industries shares fell around 9.5%% after UBS downgraded the Dutch chip-equipment maker to "sell" from "buy" and slashed its price target by 57% to €159, citing slower adoption of hybrid bonding technology.
(Updates shares in first bullet, European peers' share move bullet 8) * BE Semiconductor Industries shares fall around 9.5% after UBS downgrades the Dutch chip-equipment maker to "sell" from "buy" and slashes its PT by 57% to €159 * UBS says expectations for demand for chip-packaging technique hybrid bonding, central to Besi's investment case, "are not stacking up" * UBS sees slower adoption of HB in high-bandwidth memory as AI accelerator customers are prioritising capacity expansion over performance improvements * UBS estimates HB will account for 10% of tool demand in 2028, versus around 50% implied by consensus expectations * It estimates Besi's 2027-28 HB revenue to be 50%-60% below consensus, while demand from co-packaged optics, AI accelerators and PC processors is unlikely to bridge the gap * UBS says the existing installed capacity at TSMC and Intel can already support "meaningful volumes," limiting upside without greater-than-expected adoption * Besi shares extend Tuesday's losses, when it closed 5.4% lower following a rating downgrade from BofA Global Research on similar concerns * Elsewhere in European semis, ASML falls 2.3%, ASM International drops 5.3%, Infineon loses 5.8%, X-Fab declines 5.8%, Soitec is down 4.1%, STMicro slips 3.8%, Aixtron falls 2.7% and ams-OSRAM loses 3.6% (Reporting by Nathan Vifflin in Gdansk) ((nathan.vifflin@thomsonreuters.com)