Technology Semiconductor Capital Equipment Semiconductors Read across from 2QCY26 Hyperscalers and Semi players results to...

Equity Research 31 July 2026 | 4:15PM BST

Technology: Semiconductor Capital Equipment: Semiconductors: Read-across from 2QCY26 Hyperscalers and Semi players results to

Alexander Duval | Goldman Sachs International

Anant Jakhar | Goldman Sachs India SPL Following another series of hyperscaler capex upgrades and constructive Foundry & Ayo Odunaiya Memory commentary, we see a positive read-across for European semiconductor | capital equipment and Neocloud players. Goldman Sachs International

Hyperscaler capex and custom silicon investment continue to scale

n Microsoft: Microsoft exited 4Q with more than 30m paid Microsoft 365 Copilot seats, representing over 10m net seat additions sequentially, as deployments broaden and product innovation continues to drive higher usage. Alongside continued Azure AI momentum, surpassing $100bn and up 41% yoy, this provides further evidence that enterprise AI adoption is translating into increasing monetisation while supporting continued infrastructure investment. n Amazon: Amazon raised its 2026 cash capex outlook to c.$220bn from $200bn and expects available power capacity to double by the end of 2027 versus 2025. Trainium has secured multi-year, multi-gigawatt commitments from Anthropic and OpenAI, while AWS backlog reached $496bn, growing triple digits yoy. n Alphabet: Google Cloud revenue accelerated to +82% yoy, while backlog reached c.$514bn, supported by enterprise demand and direct TPU commitments. Alphabet raised its 2026 capex outlook to $195-205bn from $180-190bn and reiterated that spending should increase significantly again in 2027 as it expands compute capacity. n Meta: 2026 capex guidance was narrowed to $130-145bn from $125-145bn, while management continued to point to measurable returns from AI investment across engagement, recommendations and advertising monetisation. Meta also announced a partnership with BlackRock to develop a new 1GW datacentre, with our US team raising its cumulative 2027-28 capex estimates by c.14%.

Foundry, memory and WFE revisions reinforce advanced-node spending

n TSMC: Continued strength in HPC and AI supported an upgrade to FY26 revenue growth of slightly above 40% in USD terms, from >30% previously. TSMC also

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Goldman Sachs Technology: Semiconductor Capital Equipment

raised its FY26 capex outlook to $60-64bn ($52-56bn prior), while reiterating that investment over the next 3y should be significantly higher than over the preceding period. Spending remains focused on N2 and subsequent nodes, advanced packaging and the A14 ramp ahead of high-volume manufacturing in 2028. n Samsung: Management expects memory supply tightness to intensify in 2027 and persist into 2028, given the time required to add meaningful capacity. Long-term agreements already cover the five largest global datacentre customers, with further negotiations underway, and could ultimately account for c.60-70% of planned production capacity, improving visibility around future investment requirements. n WFE: Lam Research raised its 2026 WFE outlook to the low-$150bn range from $140bn, driven by stronger spending across logic, memory and advanced packaging. KLA similarly increased its estimate to >$150bn and views approximately $190bn as a reasonable level for 2027. We note our US team forecasts WFE spending of $141/$186/$208bn in 2026/27/28. Moreover, Lam continues to expect China WFE spending to be flat to slightly up in 2026.

We view the continued upward revisions to hyperscaler capex and WFE as constructive for the European semicap complex. Spending remains weighted towards leading-edge Logic, Memory and advanced packaging, while the growing number of custom…