The latest Market Talks covering Technology, Media and Telecom. Published exclusively on Dow Jones Newswires at 4:20 ET, 12:20 ET and 16:50 ET.
0745 GMT - Lenovo seems confident in managing the headwinds for consumer electronics, Citi analysts say in a research note. Management expects PC shipments to fall around 15% and smartphone shipments to decline around 20% in 2H, with commercial PCs showing more resilience than consumer, the analysts say. To offset the impact of declining unit sales, Lenovo will raise average selling prices, optimize premium product mix and focus on gaining market share, the analysts say, citing management. Citi maintains its buy call on Lenovo but raises its target price to 55.00 Hong Kong dollars from HK$31.00, after Lenovo says it expects to achieve its $100 billion annual revenue target this fiscal year, ahead of its earlier goal of hitting the milestone in two years. Shares are 3.0% lower at HK$33.86. (sherry.qin@wsj.com)
0525 GMT - Wafer price hikes are contributing more to SMIC's improving gross margin than its product mix optimization, says SMIC co-CEO Zhao Haijun in a post-earnings call with analysts. SMIC's 2Q gross margin rose to 25.3%, topping its previous guidance. The chip foundry can adjust production capacity to supply products that are in high demand and at higher prices, Zhao says. "If logic demand is low, we could use the capacity for microcontroller units or specialty memory." Price hikes by SMIC are expected to gradually reflect in the company's earnings in the coming quarters, he says. Many wafers shipped in 2Q were priced when they were produced in 4Q or 1Q. Wafers produced and shipped in the current quarter will have higher prices, he adds. (sherry.qin@wsj.com)
0502 GMT - AEM Holdings could secure new customers, which would bolster the semiconductor test company's growth, says Maybank Securities' Jarick Seet in a note. The company is in talks with new customers and its partnership with Taiwan-listed ASE could open it to more opportunities, the analyst says. AEM remains poised to expand its revenue streams, which could drive its profitability to new highs, he adds. The Singapore company also issued a 2026 earnings-per-share guidance of 24.5 Singapore cents-27.5 Singapore cents. Seet estimates this to be 20%-35% above Maybank's forecasts. He therefore raises his 2026-2027 earnings projections by 28.7%-17.8%. Maybank lifts its target price to 13.50 Singapore dollars from S$11.48. Shares drop 4.4% to S$10.50. (megan.cheah@wsj.com)
0434 GMT - SanDisk expects revenue to grow at a mid-to-high teens annual rate through fiscal 2030, according to targets unveiled at its investor day this week. The memory-chip maker outlines an ambitious long-term financial plan, forecasting average gross margins of around 80% and operating margins near 75% between fiscal 2028 and 2030. Adjusted free-cash-flow margin is projected at roughly 50%, while capital spending is expected to remain at a mid-single-digit percentage of revenue. SanDisk says it plans to prioritize more reliable, high-volume business while focusing on strategic customers that value its products. (jie.yang@wsj.com)
0242 GMT - Rising semiconductor costs are expected to force Chinese smartphone manufacturers to increase prices in 2H, which could weigh on consumer demand, says Counterpoint Research. Smartphone sales in China fell 8.6% on year in the first 30 weeks of 2026. The decline in sales post the 618 shopping festival widened to double digits due to price hikes and seasonal weakness, the research firm says. Despite the cost pressure, Huawei has maintained the lead with a weekly market share above 20% since 2Q, driven by strong demand for an entry-level model. In the 30th week, Xiaomi is at second place, while Apple has entered its typical seasonal slump before the introduction of the new iPhone series, it says. (jie.yang@wsj.com)
0142 GMT - Bell Potter analyst Chris Savage sees competition risks denting the valuation of Telstra's mobile business, especially if regulators force it to share regional assets with rivals. Savage reduces the sum-of-parts multiple he applies to the Australian telco's bulwark mobile business to 7.75x from 8x, reminding clients in a note that Australia's competition watchdog has said it is looking into how regional consumers are served by the industry. He also lowers his group price-to-valuation multiple to 22.5 times earnings, from 23.75 times earnings. Bell Potter keeps a hold rating on the stock and trims its target price 5.9% to 4.80 Australian dollars. Shares are down 0.6% at A$4.81. (stuart.condie@wsj.com)
0133 GMT - Telstra's slightly soft annual growth in postpaid mobile subscribers is seen at UBS as a hint of fragility in its pricing power. While the stock retains its neutral rating, analysts Lucy Huang and Ailsa Lei tell clients in a note that they are increasingly cautious on the postpaid market and the ability for premium brands such as market-leader Telstra to keep raising prices above inflation. They reiterate their view that consumers' ongoing shift to the value end of the market is structural and now anticipate Telstra losing 18,000 postpaid subscribers a year in the medium-to-long term. UBS trims its target price on the stock 4.7% to 5.05 Australian dollars. Shares are down 0.6% at A$4.81. (stuart.condie@wsj.com)
0129 GMT - Telstra's excellence in strategy execution is now expected and appears to be priced in, Macquarie analysts say. They maintain a neutral rating on the stock despite what they tell clients in a note is a strong fiscal 2026 performance on costs. This discipline underpinned earnings growth despite revenue falling over the 12 months through December, but the analysts point to weak growth in postpaid subscribers and a creep in capital expenditure as reasons for caution. Top-line growth looks increasingly hard for Telstra given the broader market conditions, they say. Macquarie cuts its target price on the stock by 3.4% to 5.02 Australian dollars. Shares are down 0.6% at A$4.81. (stuart.condie@wsj.com)
0117 GMT - Telstra's annual result and fiscal 2027 guidance don't appear to have won over any marginal buyers of the Australian telco's shares, Morgans analyst Nick Harris observes. The stock fell 3.2% in the session following the announcement despite a 3.5% lift in annual underlying earnings that Harris points out was in line with expectations. He tells clients in a note that Telstra's ability to push average revenue per mobile user higher at an annual rate of between 3% and 5% in the past three halves shows pricing power, but thinks that softer recent momentum in postpaid subscribers seems to have spooked some investors. Morgans keeps a hold rating on the stock and cuts its target price by 3.8% to 5.00 Australian dollars. Shares are down 0.6% at A$4.81. (stuart.condie@wsj.com)
2215 GMT - Sales to China played a role in boosting Applied Materials' revenue in the third quarter, and are expected to keep growing, CFO Brice Hill says on a call Thursday. Across the company's two main segments--semiconductor systems and applied global services--China represented 26% of revenue, he says. The company's China revenue should grow this calendar year, boosted by investments in the 28-nanometer foundry-logic process, Hill says, and continue growing next year. Shares are off 5% at $508.00 after-hours. (elias.schisgall@wsj.com)
1834 GMT - Bitcoin edges down, but the factors that have supported the cryptocurrency on a fundamental level for years continue to stay in place, says Grayscale Research in a note. Head of research, Zach Pandl, says that there's still 3 big reasons for investors to be interested in crypto. He says "unchecked" government deficits continue to trend higher, making bitcoin ownership more attractive. Trading of perpetual stock futures on various blockchain has also supported the proliferation of cryptocurrencies into the mainstream, and there is also growing risk tolerance among young investors. This current period of low volumes and rangebound prices for bitcoin won't last, Pandl adds. (kirk.maltais@wsj.com)
1825 GMT - Bitcoin is down 0.6% to $63,160, keeping rangebound amid a summer lull in trading volume. Bitcoin's relationship to macroeconomic conditions is slowly changing, says James Butterfill of CoinShares in a note--with bitcoin slowly retaking its role as a risk asset. But Butterfill says it is hard to make a lot of smart assessments around bitcoin, because of low liquidity in trading. This includes bitcoin ETFs, which have had a mixed week in terms of inflows versus outflows, according to data from CoinGlass. "This week looks set to finish with modest outflows of around US$150M, following inflows last week," says Butterfill. "In the context of exceptionally thin summer trading, we do not view that as evidence of a meaningful reversal in sentiment."
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