爱德万测试26年第4季度：已在硅光子测试领域领先；目标价上调至39,200日元

David Dai, CFA+852 2918 5704david.dai@bernsteinsg.com Juho Hwang+852 2123 2632juho.hwang@bernsteinsg.com Jack Lin+852 2123 2683jack.lin@bernsteinsg.com Price Target Advantest 4Q26/3: Already leading in silicon photonics testing;Raising PT to ¥39,200 Advantest delivered another clean beat as previewed. Company provided some new datapoints to be bullish about, further accelerating capacity targets as well as securing their firstmass production orders in Silicon Photonics. Conservative guidance per usual is to be lookedthrough.We reiterate Outperform on Advantest,update our models (download here),and raise PT to ¥39,200. Advantest beat Q4.Revenue came in at ¥328.1bn, +20% QoQ and beating consensus by14%, and in-line with our preview. GPM and OPM was strong at 67.4% / 46.7%. Net incomeat ¥126.8bn beat consensus by 38%. SoC tester was up 44% QoQ, and memory testerrevenue was down -36% QoQ. Geographically, the beat is from Taiwan (+83% QoQ), whilemost other regions were down (South Korea -39%, China -13%).FYE27 guidance wasgoodin view of their usual conservatism. Revenue was likely low-balled to be barely in-linewith consensus. Company mentioned external factors such as wafer starts, CoWoS capacityand memory supply at customers’ side as the potential limiting factors. Further acceleration of capacity targets.Management now targets 10,000 SoC testerunits per year, up from prior guidance of 7,500 — which itself is a raise from the original5,000 target. The targeted timeline is end of 2028, with possible slippage into 2029. Webelieve this was one of the most bullish data points of the quarter, as it suggests another100% growth beyond FYE27. The drivers of this acceleration were based on 1. expanding# of AI customers and firmer demand visibility 2. greater test intensity and richer testconfigurations. Management also noted that the majority of tester demand will remain to benew system purchases rather than upgrades for the next 2-3 years before upgrade cyclesbecome significant.(continued) Silicon Photonics.The CEO also highlighted their first mass production ATE orders forSilicon Photonics, as well as providing a strong growth trajectory of doubling both next yearand the subsequent year. Management also debunked the narrative that competition wasahead of them by saying they are already leading the market and “no catch up is needed”.We think Advantest has a strong presence in the segment as detailed in our Upgrade Report.As for CPUs,although company did not quantify the upside, they emphasized their strong Raised CY26 SoC tester TAM.The guidance is now $8.7-9.5bn ($8.5-9.5bn prior) for SoCtester market size, raising the lower end as they see improved visibility. Company expects toprogress with further market share gain from this year’s 66% — up 10% pts from last year.Discrepancy in growth rate between guidance revenue and TAM was attributed to CY-to-FYconversion and stronger-than-expected Mar Q. As for memory, they reiterated the previousguidance range of $2.2-2.7bn. Margins.Strong Q4 margin was driven by a higher SoC mix, and favourable product mixin memory as well. Management guided conservatively on FY27/3 profitability with an OPmargin of 44% — YoY flat, implying zero operating leverage — which presents bias towardsthe upside. FX should also be a tailwind given conservative assumption of USDJPY=¥150. Outperform.We reflect the latest Q4 earnings, and slightly tweak our model, mostly keepingour estimates from our model update from two weeks ago, multiple is likely higher given thebetter visibility. With 45x multiple (40x prior), our PT is now changed at ¥39,200 with 24%implied upside. Maintain Outperform. Investment ImplicationsWe rate Advantest Outperform (PT ¥39,200). DETAILS EXHIBIT 7:Advantest Q4 GPM / OPM was 67.4% / 46.7%,+5.4% / +5.2% QoQ respectively. APPENDIX - FINANCIAL FORECASTS BERNSTEIN TICKER TABLE I. REQUIRED DISCLOSURES References to "Bernstein" or the “Firm” in these disclosures relate to the following entities: Bernstein Institutional Services LLC(April 1, 2024 onwards), Sanford C. Bernstein & Co., LLC (pre April 1, 2024), Bernstein Autonomous LLP, BSG France S.A. (April 1,2024 onwards), Sanford C. Bernstein (Hong Kong) Limited盛博香港有限公司,Sanford C. Bernstein (Canada) Limited, SanfordC. Bernstein (India) Private Limited (SEBI registration no. INH000006378), Sanford C. Bernstein (Singapore) Private Limited,Sanford C. Bernstein Japan KK(サンフォード・C・バーンスタイン株式会社)and analysts employed by Société GénéraleAfrica Technologies & Services to produce Bernstein research under a Global Services Agreement in place between Bernsteinand Société Générale. Bernstein is part of a joint venture between Société Générale (SG) and AllianceBernstein, L.P. (AB). Unless specifically notedotherwise, for purposes of these disclosures, references to Bernstein’s “affiliates” relate to both SG and AB and their respectiveaffiliates. VALUATION METHODOLOGY Advantest Corp We set a price target of ¥39,200 using a P/E