Illiquid
A little lost in the TSM celebrations today is the news that State Grid Corp, just one of China's two dominant grid operators, has raised capex plans to US$574B over the next five years.

$3393 $2722

https://t.co/mYwCjkLrhP
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Dimitry Nakhla | Babylon Capital®
RT @wallstengine: $TSM | TSMC Q4’25 Detailed Earnings Highlights:

🔹 Revenue: $33.73B (Est. $33.3B) 🟢; +25.5% YoY; +1.9% QoQ
🔹 Gross Margin: 62.3% (Est. 60.5%) 🟢
🔹 Oper Margin: 54.0% (Prior: 49%–51%) 🟢
🔹 Net Profit: $16.30B (Est. $15.2B) 🟢

FY26 CapEx mix:
🔹 CapEx: $52–$56B (vs $40.9B in FY25, Est. $48B) 🟢
🔹 70%–80% advanced node;
🔹 ~10% specialty;
🔹 10%–20% advanced packaging /testing /mask/others

Q1’26 Guidance
🔹 Revenue: $34.6–$35.8B (Est $33.2B) 🟢; +4% QoQ; +38% YoY
🔹 Gross Margin: 63%–65% (Est 59.6%) 🟢
🔹 Operating Margin: 54%–56% (Est 50.0%) 🟢
🔹 Assumed FX (for guide): $1 = 31.6
🔹 Tax rate: 16% in 2025; expects 17%–18% in 2026

Technology Mix (Wafer Revenue) (Q4’25)
🔹 N3: 28% of wafer revenue
🔹 N5: 35% of wafer revenue
🔹 N7: 14% of wafer revenue
🔹 ≤7nm total: 77% of wafer revenue
🔹 Others (≥10nm): 23% of wafer revenue (implied residual)

Revenue by Platform (Q4’25)
🔹 HPC (incl. AI): 55% of total; +4% QoQ
🔹 Smartphone: 32% of total; +11% QoQ
🔹 IoT: 5% of total; +3% QoQ
🔹 Automotive: 5% of total; -1% QoQ
🔹 DCE: 1% of total; -22% QoQ
🔹 Others: 2% of total (implied residual); QoQ not disclosed

FY25 Recap
🔹 Rev: $122.42B 🟢; +35.9% YoY (Est. +34.5% YoY)
🔹 Gross Margin: 59.9% (vs 56.1% in FY24)
🔹 Operating Margin: 50.8% (vs 45.7% in FY24)
🔹 Net Profit: $55.13B (vs $36.49B in FY24)
🔹 Wafer shipments: 15.02M (vs 12.91M in FY24)
🔹 CapEx (FY25): $40.9B

Other Key Metrics:
🔹 ROE: 38.8%
🔹 OpEx as % of revenue: 8.4% (vs 8.9% in Q3’25)
🔹 Wafer shipments: 3.96M (12" eq.)
🔹 Wafer ASP (noted): $7,324 (+7%)
🔹 Overseas fab GM dilution: 2%–3% (early), 3%–4% (later stages)
🔹 N2 dilution: 2%–3% for FY26
🔹 N3 margin: expected to “cross over” to corporate average sometime in 2026

2026 Outlook + Long-Term Targets
🔸 FY26 revenue growth: “close to 30%” (driven by AI-related demand)
🔸 Long-term gross margin guide raised: 56% (from 53%)
🔸 AI accelerator rev growth: mid-to-high 50s% CAGR (2024–2029), raised from prior mid-40s%
🔸 Long-term total revenue growth: ~25% CAGR (2024–2029)
🔸 “Foundry 2.0” industry: 14% growth in 2026 (company view)

Node Roadmap (Mgmt)
🔹 N2 “entered… high volume manufacturing” in Q4’25 at Hsinchu + Kaohsiung with “good yield”
🔹 N2P: volume production scheduled 2H’26; “performance and power” benefits
🔹 A16: on track for volume production 2H’26; includes backside power delivery (“Super Power Rail”)

Capacity + Expansion (Mgmt)
🔹 Supply-demand: “capacity is very tight”… looking at 2028 or 2029 to “narrow the gap”
🔹 Arizona: yield/defect density “almost equal to Taiwan”… “we are going to expand many fabs there”
🔹 Timing (company): AZ Fab2 now expected to enter high volume manufacturing in 2H’27; Fab3 construction started; permits underway for Fab4 + an advanced packaging fab

Advanced Packaging + Mature Nodes
🔹 Advanced packaging: ~8% of 2025 revenue; expected to be “slightly over 10%” over time. 2026 capex around 10-20% will be for advanced packaging.
🔹 8-inch: output reduced, but “continue to support” customers as long as demand is there

Commentary:
🔸 “AI is real, not only real, it’s starting to grow into our daily life.”

🔸 “I’m also very nervous about it… we have to invest about $52 billion-$56 billion for the CapEx… If we didn’t do it carefully… that would be a big disaster for TSMC.”

🔸 “I spend a lot of time… talking to my customer and then customers’ customer… I want to make sure… demand are real… they show me the evidence…”

🔸 “Capacity is very tight… we work very hard to narrow the gap…”

🔸 “We are looking at 2028 or 2029… we hope the supply gap will be narrowed.”

🔸 “I worry about the electricity in Taiwan first.”

🔸 CFO: “Our pricing will remain strategic, not opportunistic.”

🔸 Build-out reality: “It takes two to three years to build a new fab”… meaningfully helps “2028 or 2029.”

🔸 Biggest constraint: “the bottleneck is… wafer supply.” tweet

Moon Dev
🚨 many men wish death upon me https://t.co/J5Rommg3E7
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Moon Dev
🚨 recap of my $4,500,000 bitcoin short https://t.co/DJQNDd4AEU
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Moon Dev
🚨 recap of my $4,500,000 bitcoin short https://t.co/Rp4evpDsZH
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Moon Dev
its hard to be patient as a trader

thats why i automated my trading

but since im building the quant app, i made patience built in https://t.co/zasZLtrauv
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Moon Dev
[THE END]

my $4,500,000 short printed

while the entire chat was rooting for my liquidation

this reemphasizes why i dont trade by hand

and why i dont show my positions or trade data

imagine having 50 people telling you what to do via chat and dm all day

no way. done hand trading. done sharing stats.

this is war

[$4,500,000 full tilt trade]

going to be going over what happened yesterday

how i ended up full porting short (against the trend)

and what my actions mean for things moving forward

already took my mental health break

back at it at 8 est, get a ticket: https://t.co/YGcRzsCJwf - Moon Dev
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Dimitry Nakhla | Babylon Capital®
A quality valuation analysis on $NOW 🧘🏽‍♂️

•NTM P/E Ratio: 52.28x
•3-Year Mean: 34.73x

•NTM FCF Yield: 3.61%
•10-Year Mean: 2.49%

As you can see, $NOW appears to be trading below fair value

Going forward, investors can expect to receive ~50% MORE in earnings per share & ~45% MORE in FCF per share🧠***

Before we get into valuation, let’s take a look at why $NOW is a quality business

BALANCE SHEET✅
•Cash & Equivalents: $5.41B
•Long-Term Debt: $1.49B

$NOW has a strong balance sheet, an A S&P Credit Rating & 210x FFO Interest Coverage Ratio

RETURN ON CAPITAL❌➡️✅
•2021: 4.3%
•2022: 5.2%
•2023: 8.1%
•2024: 11.8%
•LTM: 13.3%

RETURN ON EQUITY❌➡️✅
•2021: 7.0%
•2022: 7.4%
•2023: 27.3%
•2024: 16.5%
•LTM: 16.8%

$NOW return metrics are improving & trending in the right direction — a sign the business is becoming more efficient

REVENUE✅
•2020: $4.52B
•2025E: $13.24B
•CAGR: 23.97%

FREE CASH FLOW✅
•2020: $1.37B
•2025E: 26.79%

NORMALIZED EPS✅
•2020: $0.93
•2025E: $3.48
•CAGR: 30.20%

SHARE BUYBACKS❌
•2019 Shares Outstanding: 986.12M
•LTM Shares Outstanding: 1.05B

MARGINS🆗 / ✅
•LTM Gross Margins: 78.1%
•LTM Operating Margins: 14.4%
•LTM Net Income Margins: 13.7%

SGA is $NOW largest expense eating ~41% of LTM revenue, something to keep an eye on

***NOW TO VALUATION 🧠

As stated above, investors can expect to receive ~50% MORE in EPS & ~45% MORE in FCF per share

Using Benjamin Graham’s 2G rule of thumb, $NOW has to grow earnings at a 17.37% CAGR over the next several years to justify its valuation

Today, analysts anticipate 2026 - 2028 EPS growth over the next few years to be slightly less (16.84%) than the (17.37%) required growth rate:

2025E: $3.48 (25% YoY) *FY Dec

2026E: $4.08 (17% YoY)
2027E: $4.89 (20% YoY)
2028E: $5.57 (14% YoY)

$NOW has an excellent track record of meeting analyst estimates ~2 years out, so let’s assume $NOW ends 2028 with $5.57 in EPS & see its CAGR potential assuming different multiples

34x P/E: $189💵 … ~12.2% CAGR

33x P/E: $184💵 … ~11.1% CAGR

32x P/E: $178💵 … ~9.9% CAGR

31x P/E: $173💵 … ~8.8% CAGR

30x P/E: $167💵 … ~7.6% CAGR

29x P/E: $161💵 … ~6.4% CAGR

As you can see, we’d have to assume a >34x multiple for $NOW to have attractive return potential

At 32x earnings $NOW has ok CAGR potential

Given its -40% drawdown, $NOW appears to be fairly valued today at $135💵

Yes, $NOW is the workflow operating system for large enterprises, automating & governing critical work across IT, HR, security, & customer service

Once embedded, it becomes deeply integrated into how the organization runs, creating high switching costs & powerful long-term expansion

With AI layered onto these workflows, $NOW can increasingly automate & execute work end-to-end

Yet, today’s price offers little margin of safety

I consider $NOW a strong consideration with a decent margin of safety at $110💵, where I can reasonably expect ~13% CAGR while assuming a more conservative 28x
___

𝐃𝐈𝐒𝐂𝐋𝐎𝐒𝐔𝐑𝐄‼️

𝐓𝐡𝐢𝐬 𝐜𝐨𝐧𝐭𝐞𝐧𝐭 𝐢𝐬 𝐩𝐫𝐨𝐯𝐢𝐝𝐞𝐝 𝐟𝐨𝐫 𝐢𝐧𝐟𝐨𝐫𝐦𝐚𝐭𝐢𝐨𝐧𝐚𝐥 𝐚𝐧𝐝 𝐞𝐝𝐮𝐜𝐚𝐭𝐢𝐨𝐧𝐚𝐥 𝐩𝐮𝐫𝐩𝐨𝐬𝐞𝐬 𝐨𝐧𝐥𝐲 𝐚𝐧𝐝 𝐝𝐨𝐞𝐬 𝐧𝐨𝐭 𝐜𝐨𝐧𝐬𝐭𝐢𝐭𝐮𝐭𝐞 𝐢𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭 𝐚𝐝𝐯𝐢𝐜𝐞, 𝐚𝐧 𝐨𝐟𝐟𝐞𝐫, 𝐨𝐫 𝐚 𝐬𝐨𝐥𝐢𝐜𝐢𝐭𝐚𝐭𝐢𝐨𝐧 𝐭𝐨 𝐛𝐮𝐲 𝐨𝐫 𝐬𝐞𝐥𝐥 𝐚𝐧𝐲 𝐬𝐞𝐜𝐮𝐫𝐢𝐭𝐲.

𝐁𝐚𝐛𝐲𝐥𝐨𝐧 𝐂𝐚𝐩𝐢𝐭𝐚𝐥® 𝐚𝐧𝐝 𝐢𝐭𝐬 𝐫𝐞𝐩𝐫𝐞𝐬𝐞𝐧𝐭𝐚𝐭𝐢𝐯𝐞𝐬 𝐦𝐚𝐲 𝐡𝐨𝐥𝐝 𝐩𝐨𝐬𝐢𝐭𝐢𝐨𝐧𝐬 𝐢𝐧 𝐭𝐡𝐞 𝐬𝐞𝐜𝐮𝐫𝐢𝐭𝐢𝐞𝐬 𝐝𝐢𝐬𝐜𝐮𝐬𝐬𝐞𝐝. 𝐀𝐧𝐲 𝐨𝐩𝐢𝐧𝐢𝐨𝐧𝐬 𝐞𝐱𝐩𝐫𝐞𝐬𝐬𝐞𝐝 𝐚𝐫𝐞 𝐚𝐬 𝐨𝐟 𝐭𝐡𝐞 𝐝𝐚𝐭𝐞 𝐨𝐟 𝐩𝐮𝐛𝐥𝐢𝐜𝐚𝐭𝐢𝐨𝐧 𝐚𝐧𝐝 𝐬𝐮𝐛𝐣𝐞𝐜𝐭 𝐭𝐨 𝐜𝐡𝐚𝐧𝐠𝐞 𝐰𝐢𝐭𝐡𝐨𝐮𝐭 𝐧𝐨𝐭𝐢𝐜𝐞.

𝐈𝐧𝐟𝐨𝐫𝐦𝐚𝐭𝐢𝐨𝐧 𝐡𝐚𝐬 𝐛𝐞𝐞𝐧 𝐨𝐛𝐭𝐚𝐢𝐧𝐞𝐝 𝐟𝐫𝐨𝐦 𝐬𝐨𝐮𝐫𝐜𝐞𝐬 𝐛𝐞𝐥𝐢𝐞𝐯𝐞𝐝 𝐭𝐨 𝐛𝐞 𝐫𝐞𝐥𝐢𝐚𝐛𝐥𝐞 𝐛𝐮𝐭 𝐢𝐬 𝐧𝐨𝐭 𝐠𝐮𝐚𝐫𝐚𝐧𝐭𝐞𝐞𝐝 𝐚𝐬 𝐭𝐨 𝐚𝐜𝐜𝐮𝐫𝐚𝐜𝐲 𝐨𝐫 𝐜𝐨𝐦𝐩𝐥𝐞𝐭𝐞𝐧𝐞𝐬𝐬. 𝐏𝐚𝐬𝐭 𝐩𝐞𝐫𝐟𝐨𝐫𝐦𝐚𝐧𝐜𝐞 𝐝𝐨𝐞�[...]

� 𝐧𝐨𝐭 𝐠𝐮𝐚𝐫𝐚𝐧𝐭𝐞𝐞 𝐟𝐮𝐭𝐮𝐫𝐞 𝐫𝐞𝐬𝐮𝐥𝐭𝐬.
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memenodes
learned about banks. invested in bitcoin to avoid them. for extra security, moved my bitcoin to a cold wallet and safely stored in a bank locker.
peak decentralization.
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