APAC Roundup: 20 February 2026
Onto earnings call
Some highlights from the call relevant to WFE and our top picks in Singapore and Japan.
Analysts project strong WFE growth in the range of 10% to 20% in 2026, with the pace hinging on how quickly new cleanroom space becomes available.
Applied Materials guided to 20% growth in its WFE business. Again, with underlying demand being stronger than cleanroom space availability, we’d expect to see momentum into 2027, which is what Onto is guiding:
Recent discussions with customers are increasingly more constructive and include views into longer-term forecasts with several extending into 2027.
Onto then drops this news that an analyst describes as shocking:
We are quite happy to announce a volume purchase agreement from one of our HBM customers covering Dragonfly 2D and 3D bump metrology demand through 2027. This agreement is valued at over $240 million, including over $60 million in systems for 3D bump metrology. This is an example of where our expanding portfolio of technology is putting us in a position to increase the value we deliver to our customers, serving the seemingly insatiable demand for AI.
The analyst in question explains that $240m from one customer is more than what Onto made from 4 customers in 2025:
Edward Yang
I just want to focus on this $240 million VPA that you mentioned for HBM. I’m just a little shocked, I guess, in a good way. In order to just properly size this, again, it seems like a big number because from what I would gather, your total AI packaging revenue for 2025 is around that $240 million, but that includes the 3 HBM customers and the big foundry customers as well. So is that the right way to think about it in that you have one customer coming in with the equivalent of what you made from 4 customers in 2025 and the timing of -- and the cadence of how you would recognize that VPA? And would you expect additional VPAs from the other customers as well?
Michael Plisinski
For sure, we expect additional VPAs. So we are in discussions with other customers. That particular customer, remember, it’s a 2-year, so it’s extending into 2 years. It was more 2027 weighted, so maybe 2/3, 1/3. However, we see some acceleration of the demand. And so we’re starting to see this move towards this 50-50 kind of a range.
HBM manufacturing is far more materials-intensive than standard DRAM. If Onto is selling a shocking amount of equipment to one customer, that suggests a HBM ramp across the industry that is going to require a lot of HBM consumables.
Companies with exposure to HBM consumables have re-rated significantly YTD. For example, this company manufactures photo resists for HBM manufacturing:
Another example is Resonac, which makes, among other things, non-conductive films for HBM.
These are US$ 6 and 12 billion MC companies.
Our latest pick in Japan is a sub-billion USD company that looks like it has re-rated, but in reality it is probably somewhere early on the curve that Seikoh Giken was on five months ago - undiscovered, sales increasing, operating leverage kicking in, and growing from a smaller base.
It is also almost a completely pure play on HBM manufacturing, with little diversification. The writing is on the wall.
Another data point is this chart from Semi-Analysis: