Semiconductor Systems — Scenario Model

Current Price

$363

Semiconductor Systems Component

$220/sh

Market Implies

95% chance of upside scenarios

5% bear probability

Scenario Overview

Scenario	EV	$/sh	Prob	Key Gate
bull	$179B	$179	75%	next node
base	$90B	$90	20%	gaa volume ramp
bear	$46B	$46	5%	china restriction

Gate Milestones

Growth is gated by milestones. Cost step-changes and capability unlocks are tied to specific milestones.

2026

gaa volume ramp

TSMC N2 and Intel 18A enter volume production with GAA

Unlocks: Validates 15-20% content increase — directly drives tool demand

TSMC N2 volume production 2026, Intel 18A targeted 2025-2026

2028

hbm packaging

HBM4 and advanced packaging drive new tool demand

Unlocks: Opens new multi-billion dollar TAM for deposition and CMP

HBM requires 2x deposition steps vs standard DRAM

2031

next node

1.4nm/1nm transition begins with backside power delivery

Unlocks: New process complexity step — additional deposition and CMP content

TSMC N2P with BSPDN, Intel 14A targeted for 2028-2029

2026

china restriction

US export controls expand to restrict mature-node ICAPS equipment to China

Unlocks: Removes 15%+ of revenue permanently. No replacement market near-term.

China ~30% of revenue, largest WFE peer exposure. BIS has expanded restrictions 3x since 2022

Full Year-by-Year Models

Blue = input · Black = computed · Click to expand

Market-Implied Probability Reconciliation

Given these scenario EVs, what probability weights would the market need to assign to produce the current market-implied value of $220/share?

Scenario	Semi Systems EV	Per Share	Implied Prob.	Weighted Contrib.
bull	$179B	$218	75.0%	$164
base	$90B	$110	20.0%	$22
bear	$46B	$57	5.0%	$3
Total			100%	$188/sh

Note: These probabilities apply to Semiconductor Systems' contribution to AMAT equity. Services, Display & Adjacent, and net cash contribute separately.

Target contribution: $220/sh. Residual: $31.6/sh.