Silicon Investor - Silicon Motion Inc. (SIMO)

[Elroy] Silicon Motion increases sales of SSD controllers amid NAND shortage, but expect...

Elroy — 6/5/2026 6:51:36 AM

Silicon Motion increases sales of SSD controllers amid NAND shortage, but expects NAND shortages to get worse in 2027 — 'supply conditions will become even worse'

tomshardware.com

[Elroy] SIMO another all time high today. So far $314.34....

Elroy — 6/3/2026 12:22:37 PM

[Elroy] SIMO all time high. SIMO is up $26 today. I owned SIMO when it was $26....

Elroy — 6/2/2026 11:39:24 AM

[Elroy] AI Inference Revolution: Wallace Kou on Memory Shifts digitimes.com The gl...

Elroy — 6/2/2026 8:08:26 AM

AI Inference Revolution: Wallace Kou on Memory Shifts

digitimes.com

The global semiconductor landscape is undergoing a fundamental shift, moving from a focus on raw training power to the practical complexities of large-scale deployment. In an in-depth interview, Wallace Kou, President and CEO of Silicon Motion, detailed how the generative AI has evolved beyond its initial stages. While the market's early gaze was fixed almost exclusively on NVIDIA's GPUs, the High Bandwidth Memory (HBM), and the CoWoS advanced packaging technology, Kou argues that the industry is now entering the "Inference" era that is turning previous under-estimation about storage's importance on their head.

The Shift from Training to Inference

The turning point for this realization occurred during the NVIDIA GTC conference in March 2026. CEO Jensen Huang unveiled the Vera Rubin architecture, a move that signaled a massive spike in demand for NAND flash memory. During the initial AI boom, the industry was preoccupied with training massive models, a process that relies heavily on the lightning-fast throughput of HBM. However, as these models move into the inference phase - where they are actually used by end-users to generate content or solve problems - the access to context, historical data, and massive datasets storage become the primary bottleneck.

Kou notes a dramatic shift in market sentiment. Only two years ago, storage was often an afterthought in the AI conversation; today, it is a critical scarcity. "There is currently not a single global cloud service provider or major smartphone manufacturer whose demand for DRAM and NAND is being fully satisfied," Kou observed. This supply-demand gap has triggered a financial windfall for storage module manufacturers and memory giants, with some stock prices skyrocketing up to tenfold as the market reacts to persistent shortages and rising prices.

Technical Paradigm Shift: CMX and the Infrastructure of Thought

At the heart of this transition is a new architecture introduced by NVIDIA: the CMX Context Memory Storage platform. This architecture is designed specifically to handle the "KV Cache" (Key-Value Cache), which allows AI models to remember the context of a conversation or a complex task during the inference process.

The hardware requirements for the CMX architecture are staggering in their scale and technical demands. Each individual Rubin GPU requires 16TB of dedicated storage to function effectively within this framework. At a system-level scale, a single NV72 Vera-Rubin setup can demand more than 1 Petabyte, or 1,000 Terabytes, of total storage capacity. Beyond mere capacity, the CMX architecture facilitates direct GPU access to storage, a feature that bypasses traditional latency bottlenecks and ensures that AI inference remains fluid and responsive.

While this creates a massive commercial opportunity for the storage industry, it also places an unprecedented strain on NAND production. Kou emphasizes that this is not just a cloud-based phenomenon. The explosion of Edge AI - AI processed locally on devices - is further complicating the supply chain. For instance, driven by major players like Meta, the market for smart glasses is expected to reach 60 million units this year. These wearable devices require high-performance embedded storage, creating a secondary front in the war for NAND capacity.

Silicon Motion's Role: Solving the QoS Bottleneck

As the world's leading NAND controller maker, Silicon Motion sits at the intersection of these competing demands. The primary technical challenge in modern AI environments is maintaining Quality of Service (QoS). In a multi-tenant cloud environment, where multiple GPUs are accessing shared storage simultaneously for different inference tasks, data transfer speeds can often fluctuate or drop.

To solve this, Silicon Motion has deployed its proprietary PerformaShape technology. This technology ensures that even under heavy, concurrent workloads, the transmission speed remains stable. By stabilizing these data flows, Silicon Motion has positioned itself as an "indispensable stabilizer" in the AI ecosystem.

Beyond data path optimization, Silicon Motion is also extending its role into system-level infrastructure by providing enterprise-grade boot drives for leading AI GPU, TPU, and DPU platforms, ensuring system reliability and fast initialization at scale.

The Crisis of Imbalance: Kou's "Capacity Persuasion" Efforts

Despite the record-breaking revenues, Kou is deeply concerned about the "shadows" lurking behind this prosperity. The current memory market is suffering from a dangerous imbalance. To maximize profits and satisfy the insatiable hunger of AI cloud giants, major manufacturers like Samsung, SK Hynix, and Micron are funneling the majority of their capital expenditure (CAPEX) into HBM and DDR5 production.

This strategic pivot has effectively "squeezed" the production capacity available for standard NAND flash. Kou warns that this "AI squeezing effect" could lead to a collapse in traditional sectors. Over the past eight months, Kou has embarked on a global mission, meeting with leaders at Samsung, SK Hynix, Kioxia, SanDisk, YMTC, and Micron. His message is one of "capacity persuasion": he is urging these giants to reserve a portion of their production lines for the automotive, PC, and smartphone industries.

"If these foundational industries break because they cannot find parts, Edge AI will have no 'soil' to grow in," Kou warned. He believes that a total focus on the high-margin AI server market could eventually backfire, destroying the broader technology ecosystem that supports AI development.

A Stabilizing Strategy: From Cloud to Edge

Silicon Motion is positioning itself as the "transition enabler" for an industry in flux amid an expected 2–3 year supply shortage. As NAND manufacturers concentrate their internal resources on AI-driven initiatives, they are increasingly outsourcing non-core and mainstream projects, such as PCIe Gen5 controllers and embedded solutions. In this shift, Silicon Motion has emerged as a preferred partner to fill the resulting gap.

At the same time, as rising prices weigh on demand in the PC and smartphone markets, the company is helping customers pivot toward automotive and AIoT applications, including rapidly growing segments such as smart glasses, which are seeing a surge in shipments this year.

One of the most critical areas is the automotive sector, where Silicon Motion has spent a decade building a presence. While memory giants might see automotive requirements as "niche" or low volume compared to AI servers, Kou views them as essential to global stability. When major OEMs consider abandoning these specialized demands due to capacity constraints, Silicon Motion steps in to ensure the global automotive supply chain does not grind to a halt.

"We are not just looking for a surge in revenue; we want to fulfill our responsibility to the industry," Kou said. By providing stable controllers and storage solutions for AIoT and automotive applications, Silicon Motion is effectively repairing the cracks in a fractured global supply chain.

Future Outlook: 2027 and Beyond

The current supply-demand imbalance is not a temporary glitch but a structural reality that Kou expects to persist until at least late 2027 or 2028. Several factors make it nearly impossible to add capacity quickly, for example, land acquisition is increasingly difficult. The lead time for building specialized cleanrooms and procuring critical equipment now exceeds one year.

Kou predicts that while the DRAM shortage might begin to ease by the end of 2027, the relief for NAND will likely come even later. In this high-pressure environment, Silicon Motion's role as a key stabilizing force becomes increasingly important.

Particularly in emerging sectors such as smart IoT and automotive applications, Silicon Motion delivers reliable controller and storage solutions, filling the vacuum left by production shifts at major manufacturers or by projects lacking sufficient engineering support.

By helping global clients navigate the complexities of geopolitics and capacity wars, Silicon Motion aims to ensure that the AI revolution leads to a steady, sustainable future rather than a chaotic collapse of the broader tech industry.

[Elroy] Silicon Motion lays out AI-focused storage roadmap for edge, enterprise and auto...

Elroy — 5/31/2026 7:14:06 AM

Silicon Motion lays out AI-focused storage roadmap for edge, enterprise and automotive

digitimes.com

[Elroy] New Silicon Motion SM2524XT chip brings 14 GB/s to mainstream SSDs — 6nm DRAMles...

Elroy — 5/29/2026 8:37:17 AM

New Silicon Motion SM2524XT chip brings 14 GB/s to mainstream SSDs — 6nm DRAMless controller boasts heavy AI PC optimization and slashes KV cache latency

tomshardware.com

Silicon Motion will certainly demonstrate prototype drives based on its latest SM2524XT controller at the upcoming Computex trade show next week, which is when we learn when the company expects actual SSDs based on the chip to hit the market. Yet, it is safe to say that they are not going to arrive earlier than next year.

[Elroy] SIMO all time high.......

Elroy — 5/22/2026 10:58:43 AM

[Riskmgmt] Apparently he got some attention SIMO up almost 6% today. Worth watching. RM

Riskmgmt — 5/19/2026 3:44:00 PM

[Elroy] SIMO did a Q&A presentation at a JP Morgan conference about two hours ago. The w...

Elroy — 5/19/2026 1:24:27 PM

SIMO did a Q&A presentation at a JP Morgan conference about two hours ago. The webcast is on their web site.

I listened to it live. Not terribly interesting, just confirmation of the great story that is ahead of them.

At the very end of the Q&A in response to a question about operating leverage, the CEO said some things and then out of the blue said "Just wait until we report Q2 and give revenue guidance for Q3. Then you will see how quickly we can grow in 2027."

Even though that doesn't really make sense, it means that at a minimum their Q3 sales guidance is going to be through the roof. It may mean that Q2 actual sales AND Q3 sales guidance will both be through the roof.

The point I'm trying to make is SIMO is going through the roof. Insure the roof.....

[Elroy] Record-high pricing pushes SSD and memory makers to borrow $880 million just to ...

Elroy — 5/18/2026 2:28:31 PM

Record-high pricing pushes SSD and memory makers to borrow $880 million just to afford buying chips — Adata, TeamGroup, and others take on substantial debt to survive shortages

tomshardware.com

[Elroy] SIMO all time. I hope this AI euphoria lasts. SIMO has meaningful AI design wi...

Elroy — 5/13/2026 2:17:36 PM

SIMO all time.

I hope this AI euphoria lasts. SIMO has meaningful AI design wins, and they are just beginning in the current June quarter, and will ramp meaningfully in the second half of the year. SIMO's stock price may take off when they report these AI sales. Like ..... outer space take off.

[Elroy] SIMO all time high. And they haven't even begun volume production sales of Mon ...

Elroy — 5/11/2026 12:36:40 PM

SIMO all time high.

And they haven't even begun volume production sales of Mon Titan to their cloud service provider customers. What's going to happen to the stock price when those sales numbers start to appear?

[Elroy] The CEO of SIMO is on the front page of the Digitimes web site at the moment di...

Elroy — 5/10/2026 11:39:38 PM

The CEO of SIMO is on the front page of the Digitimes web site at the moment

digitimes.com

The article - The AI memory squeeze may not ease before 2028 - is behind their paywall, and SIMO isn't mentioned in the sentence that is visible, so we gotta just guess why they have a picture of SIMO CEO Wallace smack in the middle of their web site.

Who knows!?

Here's what's readable in the article:

Global memory supply is under severe strain, prompting major cloud service providers to sign multi-year contracts with memory makers and forcing the industry to rethink capacity spending and pricing. The shortage reflects long lead times for new fabs...

[Elroy] These guys were in a SIMO press release last August as a partner / user of SIMO'...

Elroy — 5/9/2026 11:54:57 AM

These guys were in a SIMO press release last August as a partner / user of SIMO's Mon Titan controller chips. Hopefully Mon Titan is in the products that Vast Data sells.

VAST Data Valued at $30 Billion as AI Drives a New Infrastructure Stack

vastdata.com

Here's the SIMO press release from last August

Silicon Motion Showcases MonTitan™ SM8366 in Core to Edge AI Server Applications at FMS 2025

https://siliconmotiontechnologycorporation.gcs-web.com/news-releases/news-release-details/silicon-motion-showcases-montitantm-sm8366-core-edge-ai-server

TAIPEI and MILPITAS, Calif., Aug. 5, 2025 /PRNewswire/ -- Silicon Motion Technology Corporation (NasdaqGS: SIMO) ("Silicon Motion"), a global leader in designing and marketing NAND flash controllers for solid-state storage devices, today announced it will showcase its MonTitan™ SM8366 PCIe Gen5 SSD controller solutions, demonstrated using the VAST Data Ceres V2 AI Storage platform and Aetina NVIDIA MGX™ server, at FMS (the Future of Memory and Storage) 2025 in Santa Clara, California, taking place August 5–7 in at booth #315. MonTitan™, together with other advanced storage solutions optimized for AI applications, underscores Silicon Motion's commitment to delivering next-generation scalability and performance for data-intensive workloads

"We are pleased to work with Silicon Motion's MonTitan™ based SSDs that support the Ceres V2 architecture to meet the performance and density demands of AI and data-intensive workloads," said Avery Pham, VP of Strategic Operations, at VAST Data. "VAST is a Software Data platform utilizing bleeding edge hardware to enable software solutions. This demo illustrates how integrating powerful SSD technology with a disaggregated storage architecture like Ceres2 can help enterprises scale AI infrastructure more efficiently and intelligently."

[Elroy] SIMO all time high....

Elroy — 5/8/2026 3:13:28 PM

[Elroy] Some comments from MCHP in their earnings call that may affect SIMO's business a...

Elroy — 5/8/2026 8:23:33 AM

Some comments from MCHP in their earnings call that may affect SIMO's business area.....

First, our storage controller products have supported some of the world's most reliable SAS, SATA, NVMe and RAID infrastructure over the past decade as a leading provider of data center storage control solutions.

And as AI inference and agentic AI workloads increased demand for persistent data access, demand for our products continues to grow. We've been strengthening our product road map and customers are responding positively. Most recently, our Adaptec, SmartRAID, NVMe storage accelerator received the Nimbus Innovation Award with benchmark results showing up to a 3x improvement in read and write performance versus a leading competitor's offering. This can translate into better XPU utilization in real-world data center workloads.

Second, our memory controller product family has been reinvigorated by the recent launch of our next-generation devices. We brought 3 new CXL and PCIe-based devices into production in calendar year 2025, and our next Gen 5 dual port device is scheduled to enter production this quarter. We've already secured meaningful design wins that have begun ramping and that we expect will continue to grow through fiscal '28. These next-generation devices have been externally benchmarked and our customers are reporting industry-leading performance in jitter tolerance, which is a key measure of storage controller performance.

--

I've read MCHP earnings calls for years, and I've never before heard them discuss storage controllers. That they're talking about it now tells me, well, it a growth area.

Mon Titan may rock!

--

Vijay Rakesh
Mizuho Securities USA LLC, Research Division

Got it. And back on the data center side, when you look at that portfolio of the PCIe Gen 6 switches and CXL which is probably starting to pick up here and storage controllers. How does that data center portfolio grow? Obviously, a lot of focus on data center and spend there. But any way to size the growth or the pickup there?

Brian McCarson
Corporate Vice President and GM of the Data Center Solutions BU

Well, there's a few important factors that are happening right now in the overall data center ecosystem. We've been experiencing a significant super cycle with respect to AI-based data centers in recent years, but that's been primarily for AI training workloads. And we're now starting to see increases in Agentic AI and inference-based workloads. And those require a significantly larger amount of access to components that are traditionally PCIe based. So CPU utilization, NVMe and storage access is heavily impacted by inference and Agentic AI workloads.

So we believe we're positioned to grow well with the market in the coming years as we see that become more of the predominant growth area in the data center market in the future. And that's across our customer base, which includes hyperscalers, it includes OEMs and traditional enterprise server manufacturers as well.

[Elroy] it does bring down the gross margin to be lower than the corporate average. Tha...

Elroy — 5/6/2026 11:37:06 PM

it does bring down the gross margin to be lower than the corporate average.

Thanks for the info. I think down the road managing the NAND portion of any drive can be challenging, moreso when NAND prices are in decline.

Their Ferri products have included NAND for years, but they seldom discuss this topic in regard to Ferri.

[Anonymous895] I reached out to IR and they confirmed that I was mistaken. The NAND memory is i...

Anonymous895 — 5/6/2026 10:35:14 PM

I reached out to IR and they confirmed that I was mistaken. The NAND memory is included in revenue and COGS and they are making a profit on the reselling of the NAND, but it does bring down the gross margin to be lower than the corporate average.

[Elroy] Glad to hear any bear stories! Lets discuss them one at a time..... The bigges...

Elroy — 5/5/2026 8:38:08 AM

Glad to hear any bear stories! Lets discuss them one at a time.....

The biggest risk here, which is obvious when compared to a company with a richer moat like NVIDIA Corporation ( NVDA), is that SIMO is not even near a broad monopoly status. It is, simply, a merchant controller supplier operating in a market where large NAND vendors can use internal controller designs. In other words, it does not control the entire storage stack; major NAND makers have captive controller capabilities, and SIMO's market could shrink if NAND vendors increase internal controller usage.

This is 100% accurate, but not a problem. Mon Titan (SIMO's enterprise controller) is SIMO's first entrant into the enterprise controller merchant market. Of course they don't have a rich moat, it's a brand new product in a large segment which SIMO is entering this quarter. No semi company enters a market and controls the full stack with a monopolistic position on day one.

From low end to high end lets look at SIMO's global market share in NAND flash controllers.

eMMC (90%+) - a monopoly
UFS - 23% last year, growing significantly as NAND makers exit.
Client SSD - 30%, design wins in the latest technology (PCEe gen5) are described as 50%+ and SIMO says their global market share will reach 40% within 2.5 years.
Boot drives - who knows? Never heard of them before Q1 last year when SIMO said they have a design win with NVDA.
Enterprise SSD controllers - 0%, they just started selling them in volume production this quarter. Time will tell.

SIMO's market could shrink if NAND vendors increase internal controller usage.

True, but every year the opposite has happened (NAND vendors outsource more and more controller units each year). NAND makers' core skill set is NAND memory wafer manufacturing. A NAND maker designing a controller and SIMO designing a controller, well, I'll bet SIMO is better at it than the NAND maker because they've got more experience in controller design. Micron only designs controllers for certain Micron products. SIMO designs controllers for everything for every NAND maker. Who you think is better at it?

NAND/DRAM scarcity is expected to remain challenging through 2026 and 2027, pressuring end-market unit volumes (smartphone and PC).

Again, true, but not a problem. Today - with the NAND memory market is it's tighest condition unable to meet demand, SIMO is growing more than 100% year over year. When the NAND market loosens up as NAND makers add capacity, NAND memory prices will drop, sales volumes will go up due to lower prices, and SIMO's sales will go up because (this is important) SIMO's sales are unit driven, not sales price driven. Low prices = more PCs and cell phones built = more SIMO controller sold (each device needs at least one).

Further, SIMO has said in the current tight NAND environment they are able to get MORE enterprise and high end customers because - when partnered with SIMO - those customers are more likely to be able to procure NAND from the NAND makers. Why? SIMO works on future projects with the NAND makers well in advance of production, this is for wafers the NAND maker plans to sell to customers that will utlize a SIMO controller in the device, and the NAND maker wants to sell those wafers. So SIMO says now partnering with SIMO is increasingly attractive to the end device maker because SIMO is able to assist them with getting the tight NAND supply.

Company now expects smartphone unit decline greater than prior 5%–10% estimate (management indicated it could be >10% YoY, with greater weakness concentrated in China). PC unit expectations also worsened to ~10%+ decline in 2026.

Again, true, but not a problem. Today - with the NAND memory market is it's tighest condition unable to meet demand, SIMO is growing more than 100% year over year. When the NAND market loosens up as NAND makers add capacity, NAND memory prices will drop, sales volumes will go up due to lower prices, and SIMO's sales will go up because (this is important) SIMO's sales are unit driven, not sales price driven. Low prices = more PCs and cell phones built = more SIMO controller sold (each device needs at least one).

Cash, cash equivalents and restricted cash declined to $210.9M from $277.1M at end-4Q25 (a decrease of $66.2M, ~23.9%), attributed to a $16.9M dividend and inventory increases to support expected ramps.

Again true, but declining cash due to inventory build is a great problem. Inventory build (Inventory was $200m in Q2 2025, it's $515m in Q1, 2026, that's $325m spent on inventory build in 9 months!) is necessary to allow the company to experience massive future sales growth. To increase sales by (for example) $100m in ONE QUARTER they've gotta purchase at least $100m extra inventory in the previous quarter, and probably more than that. I think the inventory build each Q is a great sign of SIMO's belief in higher sales in the following quarter.

Management noted DRAM supply constraints may limit adoption of high-end 8-channel PCIe 5 controllers in 2026, potentially slowing some high-ASP opportunities.

Yes, true. There are two new PCIe Gen 6 client SSD controllers. The 8 channel high end chip requires DRAM. To the extent the PC maker cannot buy DRAM, they don't need this chip. But then a high end PC doesn't sell. Demand for high end PCs (which will use this chip) get pushed out to the future when DRAM becomes more available. Fortunately the 4 channel mid-range PCIe Gen6 client SSD controller is DRAMless, which is fantastic in the current tight DRAM environment. This mid-range controller chip is perhaps a $6 chip compare to the high end one being an $11 chip, but the mid-range chip will have massive volumes due to the same DRAM tightness. Anyways, this DRAM tightness will somewhat slow sales of the high end 8 channel controller, sure. This is a minor thing in the scheme of things.

MonTitan QLC-based (high-capacity) revenue contribution is delayed due to slower rollout of 2Tb QLC NAND; near-term demand is skewing toward TLC KVCache/compute solutions, delaying some expected high-capacity ramps.

Sheesh! Mon Titan is beginning production volume sales this quarter, one quarter ahead of previous forecasts. Mon Titan added FOUR tier 1 cloud service providers (CSP) last Q (Mon Titan had 1 announced CSP customers in Dec Q, and now have 5 announced CSP customers in Mar Q), all of which enter production sales in H2 2026. If NAND supply of 2TB QLC is a bit delayed, fine, it's coming! Stocks love to look forward to good things, and FIVE cloud service providers waiting to increase purchases until 2TB NAND chips become widely available sounds like a great thing to look forward to.......

The major new positive news on the Q1 2026 call was positive developments in Mon Titan. To describe them as one of the "problems" is nuts. Mon Titan (SIMO's new enterprise controller) sounds awesome, and will probably drive major sales growth in 2027, and put SIMO squarely in the "AI data center picks and shovels" semi group in 2027.

You know what happens to the valuations of stocks that suddenly sell hundreds of millions of dollars into the core of the AI data center? They go up.

Boot drive business is ramping but remains a small contributor in 2026 so far; broader contribution expected later in the year as new controllers and customer ramps scale.

?? That's a negative concern?

This is more accurately written as follows - Boot drive business began intial production sales to NVDA in H1 2026. This segment is expected to become a meaningful contributor to sales later in the year as new controllers and additional tier 1 customers ramps scale. SIMO fabbed out a 6nm boot drive controller chip for a specific customer - at a cost of $30m -$40m to fab a 6nm chip expectations for sales to this customer are likely meaningful.

Overall I like your bull thesis, but it's not a stock that I would over-weight in my portfolio.

What does that mean? What does it mean to over-weight a stock in your portfolio?

SIMO is the best tech stock that I'm aware of at the moment. In 2027 the overall sales growth and increased contribution of AI data center sales (from almost nothing in 2026) gives me reasonable confidence that SIMO will be $1,000 or more by the end of 2027. It should be over weight in every portfolio where the owner, you know, wants the value to increase.

It would take China dropping a nuke on Taiwan to slow down SIMO's share price over the next 12 months.

[Area51] That's a good write-up of the bull case. I even bought some today. What do you t...

Area51 — 5/4/2026 11:53:15 PM

That's a good write-up of the bull case. I even bought some today. What do you think of this statement from a recent seeking alpha article (no comments so maybe you are right that SIMO is under the radar):

The biggest risk here, which is obvious when compared to a company with a richer moat like NVIDIA Corporation ( NVDA), is that SIMO is not even near a broad monopoly status. It is, simply, a merchant controller supplier operating in a market where large NAND vendors can use internal controller designs. In other words, it does not control the entire storage stack; major NAND makers have captive controller capabilities, and SIMO's market could shrink if NAND vendors increase internal controller usage.

Other concerns:

Severe Industry NAND Price and Supply Pressure
NAND prices rose sharply (management cited a sequential increase of ~55%–60% in 1Q26) and NAND/DRAM scarcity is expected to remain challenging through 2026 and 2027, pressuring end-market unit volumes (smartphone and PC).

End-Market Unit Weakness, Especially in Low-End Smartphones and PC
Company now expects smartphone unit decline greater than prior 5%–10% estimate (management indicated it could be >10% YoY, with greater weakness concentrated in China). PC unit expectations also worsened to ~10%+ decline in 2026.

Cash Balance Decline and Inventory Build
Cash, cash equivalents and restricted cash declined to $210.9M from $277.1M at end-4Q25 (a decrease of $66.2M, ~23.9%), attributed to a $16.9M dividend and inventory increases to support expected ramps.

DRAM Constraints Could Limit High-End Controller Growth
Management noted DRAM supply constraints may limit adoption of high-end 8-channel PCIe 5 controllers in 2026, potentially slowing some high-ASP opportunities.

QLC Rollout Slower Than Anticipated
MonTitan QLC-based (high-capacity) revenue contribution is delayed due to slower rollout of 2Tb QLC NAND; near-term demand is skewing toward TLC KVCache/compute solutions, delaying some expected high-capacity ramps.

Boot Drive Revenue Still Small and Early Stage
Boot drive business is ramping but remains a small contributor in 2026 so far; broader contribution expected later in the year as new controllers and customer ramps scale.

Supply Chain Specific Constraints (BGA Substrate / OSAT Pressure)
Management highlighted tight supply for BGA substrate material and elevated back-end (OSAT) costs; these constraints require active management to meet customer demand.

Overall I like your bull thesis, but it's not a stock that I would over-weight in my portfolio. It will do well if it significantly outperforms current estimates but thats not a certainty imo.

[Elroy] You may be right, but to date there has been zero discussion of NAND memory bein...

Elroy — 5/4/2026 6:56:56 AM

You may be right, but to date there has been zero discussion of NAND memory being low margin or pass through. If it were I think they would have mentioned it.

[Anonymous895] Eh, maybe, but you should assume that the NAND memory itself is super-low margin...

Anonymous895 — 5/3/2026 11:14:57 PM

Eh, maybe, but you should assume that the NAND memory itself is super-low margin. Not even sure that they count it as revenue; good chance that it's pass-through.

[Elroy] Yes, I was aware of the Bluefield 3 situation. However, a boot drive controller...

Elroy — 5/3/2026 5:41:45 PM

Yes, I was aware of the Bluefield 3 situation.

However, a boot drive controller is perhaps $20 (who knows), while a 2TB boot drive (SIMO controller + 2TB NAND memory) is, I don't know, $1,000? If SIMO is getting close to 100% of the complete drives (controller + NAND) in Bluefield 4, that's a healthy sales ramp over all controllers and 1/3 of the NAND in Bluefield 3.

I think!

[Anonymous895] To clarify matters on the Bluefield 3 platform, they are indeed one of three mak...

Anonymous895 — 5/3/2026 3:17:26 PM

To clarify matters on the Bluefield 3 platform, they are indeed one of three makers of boot drives for the system. But the other two makers are also using Silicon Motion controllers (albeit a different one than the one they are offering Nvidia in their direct solution). So all of the controllers being used in these boot drives are Silicon Motion controllers. That's good, obviously, but that also means that winning the majority of slots in the next-gen system (I take this to mean that they expect to win the majority of slots via their direct solution) is not necessarily as much of an uplift as it sounds. Of course, the next-gen system will need more boot drives per system and will be a more sophisticated, more expensive chip, etc.

[Elroy] CSP capex push toward US$700B as AI race intensifies, but ASIC demand timing rem...

Elroy — 5/3/2026 12:59:28 PM

CSP capex push toward US$700B as AI race intensifies, but ASIC demand timing remains uncertain

digitimes.com

SIMO begins shipping Mon Titan controller for production delivery with five CSPs in Q3 2026.

Sales gonna go boom.

[Elroy] A few thoughts on SIMO after digesting their earnings release and conference cal...

Elroy — 5/2/2026 12:44:24 PM

A few thoughts on SIMO after digesting their earnings release and conference call of last week.

Sales are going up in EVERY category.

In legacy SIMO (NAND controllers for gadgets, cell phones and PCs) the main competition has historically been the internal controller divisions of the NAND makers themselves. NAND makers have completely exited gadgets (eMMC controllers) leaving SIMO as a monopoly. This is a 900 million (!!) unit per year segment (smart TVs, tablets, smart glasses, gadgets which use NAND) with modest growth. In cell phone NAND controllers the NAND makers are rapidly exiting the market - instead of selling a memory module (memory + controller) to the cell phone companies the NAND makers are now selling a wafer of memory to a module maker which then buys a controller (usually from SIMO), packages it into the module, and the module maker sells the memory module (with a SIMO controller) to the cell phone company. In the PC NAND controller segment SIMO's historical share is 30%, in the latest technology (PCIe Gen5) SIMO's design slot win is greater than 50%, so as the PC transitions to the new technology over the next few years SIMO's sales will go up via BOTH unit market share increases and higher selling prices per chip. Down the road (5+ years) probably the PC industry follows the gadget and cell phone industries, the NAND makers exit, and SIMO gets.......ALL the business.

That's the boring old stuff.

In NAND controllers for autos SIMO's sales are rapidly taking off, up 700% year over year in Q1, and this segment should grow for decades along with the increased electronics in cars. SIMO has an OEM relationship with Samsung for eMMC NAND controllers in cars, and with Sandisk for UFS NAND controllers in cars, and also sells it's own internally developed memory modules directly to automobile makers. Semis in cars are hot, and SIMO is in it. This segment is forecast to become 10% of sales this year from almost nothing last year.

Boot drives! This came out of nowhere, but NVDA asked SIMO to make a boot drive for it's Bluefield 3 system. This product began sales in Q4 2026 and is selling now. SIMO is one of three makers of boot drives for Bluefield 3. SIMO made that Bluefield 3 boot drive by customizing an existing controller chip. For future NVDA boot drives SIMO made a state of the art, 6bn customer "boot drive" chip last quarter. SIMO expects to win THE MAJORITY of boot drives for NVDA's Bluefield 4, and expects that there will be 4x the number of boot drives per bluefield system, and expects their price to be perhaps 10x the price of a bluefield 3 boot drive due to higher capacity (2TB versus 128GB) of Bluefield 4 versus Bluefield 3. Uhmmmmm, this could he HUGE!

Enterprise NAND SSD controllers. This is a product (named Mon Titan, a 6nm chip) that has been three years in development. Last quarter it had two announced tier one customers that were supposed to begin purchasing in Q3 this year. This quarter it was announced that volume sales production began one quarter early (Q2, right now) AND SIMO now has FIVE tier one customers (two in the US, three in Asia) that are all forecast to begin purchasing Mon Titan in H2 2026. Tier 1 customer means like Amazon, Oracle, Microsoft, IBM Cloud, Meta, Google, Ali Babba, Baidu, Ten Cent, etc.). When those guys buy, they buy a lot, and the buy more and more and more every year. Uhmmmmm, this is very probably going to be very very very HUGE!

The future for Mon Titan. SIMO is in q3 2026 taping out a 4nm uber high tech version of Mon Titan for enterprise SSDs in the data center. They ALREADY have design wins with two NAND makers and multiple cloud service providers. It means the NAND maker wants to make a super high capacity NAND memory chip (4TB?) and use a 4nm SIMO developed controller to make a drive. This chip will enter volume production in 2028. Why is it interesting? Because it shows SIMO is in the heart of NAND memory product development in the fastest growing high tech AI datacenter segment.

If this isn't the best sounding high tech stock out there I don't know what's better. Lets consider some things.....

The boot drive and Mon Titan served markets are massive. SIMO apparently is having design win success supported by the idea that they are on of three makers of boot drives for Bluefield 3 (shipping now), so they made a custom chip and expect to be a sole supplier of boot drives for Bluefield 4, which has more boot drivers per system and higher prices per unit due to higher expected capacities.

Ok, well, I could go on. SIMO is definitely NOT a value stock, but it is a growth stock ENTERING the AI datacenter semiconductor segment RIGHT NOW, with lots of design wins from tier 1 entities.
It's going to $1,000 within 2 years, I think easily.
And it's going to blow away sales numbers for the next 8 quarters, again easily.

And it's probably very underowned. Who's ever heard of SIMO? Not many people. But with the coming ghrowth - in AI datacenters - everyone interested in tech stocks will have heard of SIMO in two years, and want to own it. That's what causes prices to go up.

Ok, you heard it here first.

[Elroy] SIMO all time high share price today.....

Elroy — 5/1/2026 12:47:30 PM

[Elroy] Some interesting bits from SIMO's recent conference call.... We have spent many...

Elroy — 4/30/2026 10:14:10 PM

Some interesting bits from SIMO's recent conference call....

We have spent many years developing deep relationship with the NAND flash makers, which have allowed us to gain share as NAND makers outsource more of their controller requirement. These strong relationships have also allowed us to secure NAND in the difficult environment as we ramp our Ferri and enterprise boot drive business and help our module maker and AI smart storage system customers secure NAND, making us an even more valuable and strategic partner.

Given our current backlog and design win pipeline, we expect sequential growth across our product portfolio in 2026 as we capitalize on our investment, gain share in existing markets and benefit from our diversification strategy, starting with another strong sequential quarter of growth of 15% to 20% in June.

The mobile market is undergoing a rapid shift as NAND manufacturers accelerate the outsourcing of controller to third party, especially Silicon Motion.

The market for eMMC are large and growing at over 900 million units sold every year. With major flash makers essentially gone from this segment, competition is decreasing and our revenue contribution from this market is growing. Based on our current backlog, customer forecast and continuing share gains, we expect another very strong year of growth in our embedded eMMC and UFS business with share gains dramatically outpacing the macro pressure on smartphone unit sales.

Fortunately, for Silicon Motion, our products span the market from value line to the high end, and we continue to gain share across the range of devices as the NAND market makers exit the consumer segment.

I'm excited to announce that our MonTitan customer plan to begin ramping of 3 Tier 1 Asian CSP and 2 U.S. Tier 1 CSP later this year with both TLC compute and QLC1ory SSD solutions. In the third quarter, we expect to tape-out our first 4-nanometer controller, a PCIe 6 MonTitan controller targeting hyperscaler and CSPs. It has been developed in close collaboration with multiple partners and customers, and we expect it to drive the next phase of MonTitan growth beginning in the 2027, '28 time frame.

Importantly, we have already secured design wins with multiple Tier 1 customers with volume expected to ramp meaningfully in 2028. Given the traction we are seeing and the progression of end user qualification for both TLC and QLC implementation of MonTitan, we are increasingly confident that the business will grow rapidly throughout this year and at our target run rate of 5% to 10% of our now expanded 2026 revenue expectation with further growth anticipated in 2027 and beyond as our entry into the enterprise market scales meaningfully over time.

Sourcing NAND is becoming more critical to our long-term success. Our unparalleled relationship with the NAND maker has become a key differentiation and has enabled us to secure NAND from 3 different makers, which will ensure we will remain a resilient supplier of Ferri solution and boot drive for our customers despite the increasing supply constraints. NAND supply allocation for 2026 were largely finalized by all flash makers by mid last year.

Our ability to secure NAND has given us a meaningful competitive advantage as we are one of few suppliers globally able to consistently source NAND to support our customers' accelerating requirements. Ultra storage is rapidly becoming one of our most exciting growth opportunity as we are actively engaged with multiple customers to build solutions that operate across a variety of platforms. This includes leading DPU, Ethernet and NVLink switches and other opportunity across different AI infrastructure architecture. In the fourth quarter of 2025, we began volume boot drive shipment to a leading AI GPU manufacturer for their current DPU product.

In the first quarter, we worked with that customer to qualify next-generation DPU design as well as Ethernet and NVLink switches of their new GPU CPU platform to be launched in the second half of this year. As our customers transition to the next-generation GPU CPU platform, our opportunity is increasing rapidly with a much broader footprint beyond the DPU boot drive and with the density that increased 2 to 4x from the previous generation. We anticipate strong revenue contribution and growth with this customer this year and throughout 2027. In addition to this customer, we have recently won a design with a leading telecommunication infrastructure provider and will be ramping initial scale with them later this year.

Despite ongoing supply constraints and price increases associated with the NAND and DRAM, we continue to expect that we will deliver sequential growth throughout 2026 as we reap the benefit from the investments we have made over the past few years.

If you take a look at our automotive, Ferri and our boot drives, we're just in the early stages of that ramping.

we also anticipate MonTitan to begin to ramp more meaningfully in the second quarter -- starting in the second quarter as well. So that will be another growth vector for our second quarter.

We didn't give a full year guidance, but wait for our next quarter results and the guidance for Q3.

(They are going to blow sales out of the water in Q3).

50% gross margin is definitely achievable.

So for our first engagement for the DPU BlueField 3, there will be 3 makers provide the solution. Two other NAND makers also use the Silicon Motion controller, but different controller, different NAND. And we also -- with our additional different controller to support. But I think through the engagement, I believe the customer will like to focus on the new generation DPU and also provide much more deeper NVLink and Ethernet, the C69 switches project to us because for the new generation boot drive, security becomes very critical. I believe today, we are probably only one to have a specific security in our firmware and hardware in our controller.
And we have a unique firmware with -- to manage the NAND into a pseudo LC mode, provide specific function for the end customer. So that's why we believe we probably have a majority of the new generation boot drive in this particular customer.
(That said their market share in boot drives will increase significantly with the next generation NVDA production, which launches in H2 2026)
We see MonTitan now get tremendous attention and a very, very broad design win. We're very happy in our progress. We see we'll continue to gain market share. We see MonTitan, even for PCIe Gen 5 and associate product, we will grow to at least 5% to 10%, aligned with our expanded 2026 revenue and '27. Our PCIe Gen 6 MonTitan even stronger even before we tape-out, we have multiple design wins from Tier 1 customers, including 2 NAND maker and several CSP customers. So this is bringing a very, very broad and long-term commitment and for development.
We see the -- our PCIe Gen 6 MonTitan also have a very, very unique technology with 160x LDPC and support both TLC and QLC for next-generation QLC. So we have a very, very broad customer waiting for the product, and we'll continue ramping PCIe Gen 5 and waiting for PCIe Gen 6 for design win pipeline.
we expect to see margins continue to improve, operating margins continue to improve throughout this year.
Let me add some comment. Silicon Motion procure NAND is not like a normal customer. We are a strategic partner for NAND maker because we are a mutual business, and we engage their project to many, many large-scale customers, too. So they treat us as a partner, not just a normal buyer for NAND.
---------------------
The growth is just beginning, and "AI data center (Mon Titan and boot drive)" growth is going to meaningfully kick in in Q3. When they say that in the Q2 call, it's going to the moon.

[Elroy] SIMO's 2025 annual report is out. MXL stuff (nothing new, but confirmation that...

Elroy — 4/30/2026 5:20:35 PM

SIMO's 2025 annual report is out.

MXL stuff (nothing new, but confirmation that now they're just awaiting the decision)

On October 5, 2023, the Company filed a claim in the SIAC against MaxLinear for breaching the Merger Agreement. In the arbitration, theCompany is seeking payment of the termination fee of US$160 million, together with further substantial damages, interests, and costs. Following hearings conducted in October 2025 and March 2026, the arbitration proceedings have concluded, and the parties are awaiting the issuance of the finalaward. If the Company succeeds in its claims, MaxLinear will likely be ordered to pay the Company’s legal fees and the costs of the arbitration. If theCompany does not succeed in some or all of its claims and/or in defending the counterclaim, it may be ordered to pay some or all of MaxLinear’s legalfees and the costs of the arbitration. The quantum of the legal fees and costs to be paid by either party will be decided by the tribunal. No assurance canbe given that if an award is granted in the Company’s favor, that the award can be collected or that the Company will not be required to take furthermeasures to be able to collect the award. Under the SIAC Arbitration Rules, all matters relating to the proceedings are confidential.

I think that just confirms that the arbitration discussion is over, and now they're just awaiting the decision.

--

Sales to our five largest customers represented approximately 61%, 66% and 66% of our net revenue in 2023, 2024 and 2025, respectively. Sales to our customers constituting more than 10% of our net revenue represented, in the aggregate, 45%, 57% and 58% of our net revenue in 2023, 2024 and 2025, respectively. Our customers constituting more than 10% of our net revenue were (i) Micron, SK Hynix and AFASTOR in 2023, (ii) Micron, Kioxia, PHISEMI and AFASTOR in 2024 and (iii) PHISEMI, Kioxia, AFASTOR, and Micron in 2025. The identities of our largest customers and their respective contributions to our net revenue may vary from period to period.

Hmmm - Interesting that Kioxia is now a major (more than 10%) customer. Kioxia is the old Toshiba NAND division, the Japanese NAND maker.

As of April 7, 2026, we have 3,276 patents and 1,035 pending applications worldwide.

In 2025, our net sales increased by 10% year-over-year to approximately US$885.6 million, primarily due to the continuing new products and new customers ramp and increase in market share with NAND makers, module makers and OEM customers. Our mobile storage revenue increased by 10%year-over-year primarily because of an increase in sales of eMMC and UFS controllers, partially offset by a decline in sales of SSD controllers and SSD solutions. Our SSD controller sales decreased in the range of 0% to 5% year-over-year to account for 45% to 50% of revenue, a lower percentage of net sales than the prior year, eMMC plus UFS controller sales increased in the range of 20% to 25% year-over-year to account for 40% to 45% of revenue, a higher percentage of net sales than the prior year, and SSD solutions sales decreased in the range of 10% to 15% year-over-year to account for 0% to 5%of revenue, a lower percentage of net sales than the prior year.

Office Building Construction (they're building another one!)

In September 2018, the Company paid US$58.9 million to acquire land in Hsinchu, Taiwan intended for its futureTaiwan headquarters building. Construction began in January 2021, and as of December 31, 2025, the project, with a capitalized cost ofUS$67.0 million, completed in 2025. In addition, we won a bid with a third party to build an office building in Taipei, and we entered into a propertydevelopment agreement in May 2021. We received the construction license in September 2025 and the development cost is expected to beapproximately US$101 million. We expect to complete construction of the building by the end of 2029.

[Elroy] Stuff from QCOM's call that may affect SIMO We now estimate that QCT handset re...

Elroy — 4/30/2026 3:29:22 PM

Stuff from QCOM's call that may affect SIMO

We now estimate that QCT handset revenues from Chinese customers will reach a bottom in the third quarter (June) and return to sequential growth in the following quarter (Sep).

Okay. I guess we'll stay tuned. For my follow-up, can you maybe walk through why you're confident that -- I assume it's fiscal third quarter that you were referring to with the third quarter, but why you're confident fiscal third quarter can be the bottom for Android sales -- Android QCT sales into China? I mean that's typically -- September quarter is usually a typically down seasonal quarter. And just given how low visibility is right now overall in the handset market, I'd be curious just what inputs you're seeing that gives you the confidence it's going to bottom in the June quarter.

Akash Palkhiwala
Executive VP, CFO & COO

Sure, Josh. It's Akash. So if you think about the impact to QCT from Chinese handset OEMs as a result of the memory dynamics, it's really 2 parts. The first part is the scale of the handset market. And there, we've seen some small decline in it, especially in the mid-low tiers. But by far, the larger impact have been the OEMs making a decision to slow down their builds and draw down on channel inventory. So both of these factors have been in our March quarter results, and they're also represented in our June quarter guidance.

And so what we end up doing in both quarters is really significantly undershipping the end consumer demand for handsets as a result of the channel inventory drawdown factor. So as we look forward, we feel confident that the third quarter is now the bottom. And so as we go forward, the revenue is going to be much closer to the scale of the handset business versus the inventory drawdown factor continuing into our forecast.

Cristiano Amon
CEO, President & Director

Josh, this is Cristiano. I just want to add one thing because there's another way to look into this. As you know, because of our licensing business, we do have visibility of what happens in the market. So we know sell-through. We know how the sell-through market is behaving even when increase price on the handsets. So it gives us a real good idea on activations and customer demand versus what we're shipping. So that dynamic outlined by Akash is kind of very clear to us that Q3 (June) becomes the bottom.

[Elroy] They have said on previous calls that they have two tier 1 customers and four ot...

Elroy — 4/30/2026 9:49:00 AM

They have said on previous calls that they have two tier 1 customers and four other customers.

Mon Titan is in production this quarter with......someone.

I wouldn't assume there are 7 tier 1 customers, I think Mon Titan is in production this quarter with smaller customers, and 5 tier 1 customers start buying in H2 2026. My interpretation.

Anyways, we're discussing small details. "Mon Titan is going to sell a lot soon" is the message.

[Anonymous895] Yes, we do. They have mentioned on numerous previous calls that they have two ti...

Anonymous895 — 4/29/2026 8:34:38 PM

Yes, we do. They have mentioned on numerous previous calls that they have two tier-one customers for MonTitan. Those are their launch customers. Now they are saying they have another five, total of seven.

[Elroy] We don't know that the two customers purchasing this quarter are "tier 1", whate...

Elroy — 4/29/2026 9:38:05 AM

We don't know that the two customers purchasing this quarter are "tier 1", whatever that means.

But yeah, the Mon Titan sales are going to explode.

And they said on the call that Mon Titan has some capability that other enterprise flash controllers lack, which is especially attractive in the inference process, it somehow allows Mon Titan to work on 4 tokens at the same time. In other words, they think their product is superior to competitors, the customers can tell, so the customers are moving to Mon Titan.

It's an amazing growth story now. I think $200 will be considered cheap a year from now.

[Anonymous895] Those 5 MonTitan customers that they mentioned are in addition to the 2 launch c...

Anonymous895 — 4/29/2026 8:48:53 AM

Those 5 MonTitan customers that they mentioned are in addition to the 2 launch customers launching this quarter. So a total of 7 tier-one CSP customers for 2026, 4 Asian and 3 US.

[Elroy] from the release - MonTitan will enter volume commercial production in the curre...

Elroy — 4/29/2026 7:19:14 AM

from the release - MonTitan will enter volume commercial production in the current quarter, earlier than planned, and our customers expect to ramp five tier-one CSPs, three in Asia and two in the US, in the second half of this year.

According to Perplexity

which companies in asia could be described as a tier one cloud service provider? List them all

There isn’t a single official global definition of “tier one cloud service provider,” but in Asia the companies most commonly described that way are the large-scale hyperscalers and dominant regional leaders: Alibaba Cloud, Tencent Cloud, Huawei Cloud, NTT Communications/NTT DATA, Fujitsu, China Telecom Cloud, China Unicom Cloud, China Mobile Cloud, Naver Cloud, KT Cloud, and Singtel Cloud/Paragon.

which companies in the usa could be described as a tier one cloud service provider? List them all

Amazon Web Services (AWS), Microsoft Azure, Google Cloud Platform (GCP), Oracle Cloud Infrastructure (OCI), and IBM Cloud are the companies in the USA most consistently described as tier one cloud service providers. These represent the primary US-headquartered hyperscalers and leaders per market share data, Gartner evaluations, and industry analyses.

----

Sales to 5 of those companies ramp in H2 2026. In other words, sales to them are not in the just reported quarter and start from zero in the current quarter, then go to the moon from Q3 2026 on.

It's not too late to buy SIMO. That's WAY more customers for this Mon Titan chip than they'd previously announced. The previous announcement was two tier one customers, 1 in Asia 1 in the US, and the volume would start perhaps in Q3 2026 but also perhaps in Xmas 2026. There are now 5 customers and the volume starts in Q3.

Mon Titan is the chip that goes on an enterprise NAND SSD. NAND is going through the roof (look at the SNDK chart).

It's going to the moon.

[Elroy] I asked perplexity "which companies in asia could be described as a tier one clo...

Elroy — 4/29/2026 6:57:25 AM

I asked perplexity "which companies in asia could be described as a tier one cloud service provider? List them all"

--

There isn’t a single official global definition of “tier one cloud service provider,” but in Asia the companies most commonly described that way are the large-scale hyperscalers and dominant regional leaders: Alibaba Cloud, Tencent Cloud, Huawei Cloud, NTT Communications/NTT DATA, Fujitsu, China Telecom Cloud, China Unicom Cloud, China Mobile Cloud, Naver Cloud, KT Cloud, and Singtel Cloud/Paragon.

What “tier one” usually meansIn practice, people use “tier one” to mean providers with major regional scale, broad service portfolios, strong enterprise adoption, and significant infrastructure footprints. In Asia-Pacific, research repeatedly places Alibaba among the top leaders, with AWS and Microsoft also prominent across the region, while Tencent, Huawei, NTT, Fujitsu, and several national telecom clouds are the main local leaders in their home markets.

Asia-based providers commonly included

Alibaba Cloud, China.
Tencent Cloud, China.
Huawei Cloud, China.
Baidu AI Cloud, China, often mentioned as a major Chinese cloud provider though usually below the top three.
China Telecom Cloud, China.
China Unicom Cloud, China.
China Mobile Cloud, China.
NTT Communications / NTT DATA, Japan.
Fujitsu, Japan.
Naver Cloud, South Korea.
KT Cloud, South Korea.
Singtel Cloud, Singapore.

--------------

which companies in the usa could be described as a tier one cloud service provider? List them all

Amazon Web Services (AWS), Microsoft Azure, Google Cloud Platform (GCP), Oracle Cloud Infrastructure (OCI), and IBM Cloud are the companies in the USA most consistently described as tier one cloud service providers. These represent the primary US-headquartered hyperscalers and leaders per market share data, Gartner evaluations, and industry analyses.

Tier One DefinitionTier one typically refers to hyperscale providers with massive global infrastructure, comprehensive IaaS/PaaS/SaaS offerings, dominant market share (e.g., top 5-10% globally), and leader status in reports like Gartner's Magic Quadrant for Cloud Infrastructure. In the USA, this excludes smaller or regional players like DigitalOcean, Linode, or Vultr, focusing on enterprise-scale giants.

[Elroy] SIMO mega upside blowout quarters. Sales were supposed to be about $300m in Q1....

Elroy — 4/28/2026 6:13:34 PM

SIMO mega upside blowout quarters.

Sales were supposed to be about $300m in Q1. Came in at $342m.
Next Q guided to $400m, with sequential increases expected throughout the year.
Inventory up $100m sequentially to $515m. It was $200m in Q2 2025. They gonna increase sales massively this year.

Mon Titan (their enterprise SSD controller) to enter production in Q2 " MonTitan will enter volume commercial production in the current quarter, earlier than planned, and our customers expect to ramp five tier-one CSPs, three in Asia and two in the US, in the second half of this year."

The kicker? 60% of SIMO's sales are PC SSD controllers. That segment declined in Q1 due to a weak PC market and normal seasonality. That segment is supposed to pick up in Q2 2026. So they're growing massively overall while their largest segment had a sequential decrease.

Uhmmmmm, It seems reasonable to expect $2 billion in 2027 sales. Give it a 5x price to sales multiple (due to the insane sales growth rate) and you've got a $10b company, or $300 per share.

Don't sell.

[Elroy] SIMO closes at an all time high. --- Check out the SIMO options today today M...

Elroy — 4/24/2026 4:13:15 PM

SIMO closes at an all time high.

---

Check out the SIMO options today

today May SIMO options trading

3,972 $150 calls - yesterday there was 3,935 open interest
7,862 (!!) $55 calls - yesterday there was only 305 open interest
3,948 (only? come on!) $60 calls - yesterday there was only 111 open interest

12 at the money May puts.

June had less than 100 call contracts traded.

Uhhhh, that's a lot of options trading for little SIMO. They report next Tuesday after the close.....

[Elroy] Hopefully they do a secondary up here, raise lots of cash, and then they can pay...

Elroy — 4/24/2026 12:28:38 PM

Hopefully they do a secondary up here, raise lots of cash, and then they can pay SIMO!

[franklin1] Wow oh Wow check out MXL

franklin1 — 4/24/2026 12:09:48 PM

[Elroy] SIMO traded at all time high ($147.88) this morning...... bring on the quarterl...

Elroy — 4/24/2026 9:58:44 AM

SIMO traded at all time high ($147.88) this morning......

bring on the quarterly results!

[Elroy] MXL just reported and has this interesting tidbit in their press release...... ...

Elroy — 4/23/2026 5:44:38 PM

MXL just reported and has this interesting tidbit in their press release......

MaxLinear today announced that it has amended its existing Credit Agreement with Wells Fargo and other lenders to extend the maturity date of the revolving credit facility from June 2026 to March 2028. While currently MaxLinear has not drawn down on this facility, the amendment also increased the amounts available under the facility by $30 million to $130 million.

--

If there is one thing about MXL that SIMO investors like, it's them having lots of access to cash!

[Elroy] Acer FA300 Gen5 2TB SSD Review – We Discovered the Perfect Gen5 Laptop/Ultra Por...

Elroy — 4/22/2026 4:35:00 AM

Acer FA300 Gen5 2TB SSD Review – We Discovered the Perfect Gen5 Laptop/Ultra Portable SSD!

thessdreview.com

It is not often that we start a report off speaking to the interior components of an SSD. This is that exception so bear with us as this will play out very well. Last June, we attended Computex and discovered a new PCIe 5.0 SSD controller by SMI, the SM2504XT. Its extremely small footprint tied into great performance, while having such a low power rating, meant that we may have found our first truly high power low heat Gen5 SSD controller. We left Computex with an engineering sample of that SM2540XT in hand and couldn’t wait to start testing.

Through our testing, we discovered that this DRAMless Gen 5 SSD could achieve just under 12GB/s data transfer speeds and over 1.5 million IOPS, all the while maintaining a very cool operating temperature and having an active power rating of only 2.4w. Could we have found the perfect laptop SSD? Our initial test regimen seemed to think so but that wasn’t enough. We threw our best SSDs into the mix and then published ‘The Ultimate Laptop Battery Test‘ How do you think the SMI SM2504XT Gen5 engineering sample stacked up to the rest?

[Elroy] For some reason MXL is on a wild up move recently. No idea why......

Elroy — 4/20/2026 4:21:00 PM

[Elroy] SIMO for some reason catching the "AI mood" again........it's all time high is $...

Elroy — 4/17/2026 10:20:40 AM

SIMO for some reason catching the "AI mood" again........it's all time high is $146.85

[Elroy] Well well, third highest closing price ever for SIMO. It closed at about $143 o...

Elroy — 4/15/2026 7:57:23 PM

Well well, third highest closing price ever for SIMO. It closed at about $143 once back in last Feb 2026.

Interesting times.

I really have no idea what to expect out of the upcoming earnings release. Good, bad, normal, hard to say the way things have been going.

[Elroy] AI infrastructure boom triggers NAND shortage, memory profits seen rising 2–3x, ...

Elroy — 4/14/2026 12:12:08 PM

AI infrastructure boom triggers NAND shortage, memory profits seen rising 2–3x, Silicon Motion says
Siu Han, Taipei
Apr 14, 2026, 12:19

Silicon Motion's president, Wallace Kou, said the memory industry is undergoing an irreversible structural shift driven by AI infrastructure growth. Since August 2025, NAND flash prices have surged 4–10x, and module makers' profits are expected to grow 2–3x in 2026 as this becomes the new normal.

Nvidia CEO Jensen Huang's GTC 2026 remarks forecast over US$1 trillion in demand for Blackwell and Rubin chips in 2027. Kou stated that AI infrastructure is still in its early stages with room for multiple players, and that only partners aligned with Nvidia's ecosystem will thrive amid the AI wave.

Kou also noted the rise of edge AI deployments and generative AI integration into smartphones, PCs, and other devices. Despite weakness in traditional retail channels and consumer electronics, many memory module vendors are leveraging low-cost inventory advantages and successfully pivoting to AI-related product lines — including supplying PC chains and major firms like Google and Meta. This positions them for strong operational and profit growth in 2026, making 2–3x profit increases unsurprising.

AI devices such as wearables and smart glasses require large volumes of eMMC storage products, signaling a structural shift in the storage industry and consumer market. The market cannot revert to previous conditions; companies must adapt and find new strategies to sustain growth.

NAND price surge and cautious capacity expansion
Kou highlighted that since August 2025, NAND prices have risen 4–10x, especially for lower-capacity products, creating a significant supply-demand gap. Memory manufacturers suffered heavy losses during downturns, which led to oversupply and NAND prices falling below the cost of dumplings. As a result, they remain extremely cautious about expanding production capacity.

New technology fabs and equipment investments are costly — for example, building 10,000 wafers of 1C DRAM technology requires US$10 billion, with limited output gains. Meanwhile, capital expenditures are being directed toward next-generation high-bandwidth memory (HBM4) and HBM4E production, further limiting NAND investment.

The three main memory suppliers plan to expand DRAM capacity first, targeting mass production from late 2027 to 2028. This may slightly ease shortages but will not fully resolve them. More capital expenditure will then flow to NAND flash, which is expected to increase output by only 15–25% — still negligible against massive AI demand.

AI demand outlook and potential shortage intensification
Concerns about an AI bubble appear minimal as AI agent and inference workloads drive even greater demand. Enterprises need comprehensive AI deployment, and everyday life increasingly relies on AI, boosting overall demand for HDDs, SSDs, NAND, and DRAM.

Kou stated that Silicon Motion's current customer purchase orders far exceed supply capabilities, with severe shortages already evident in 2026. Combined gaps suggest 2027 will see intensified cloud service provider demand surges, worsening shortages and marking the toughest year ahead.

Price trends point to continued rises for both NAND and DRAM. While high-end products can absorb cost increases, entry-level phones and PCs face shipment declines. Automotive OEMs have been slower to stockpile, initially doubting the permanence of shortages and price hikes.

To prevent automotive supply chain disruptions, Silicon Motion plans to coordinate with NAND manufacturers to ensure steady capacity allocation. Without this, vehicles worth tens of thousands of dollars could be delayed due to missing storage components costing just tens of dollars.

Shortages impacting mobile phones, PCs, and edge devices would hinder consumers' ability to access cloud AI services, undermining the foundations of AI development.

[Elroy] AI infrastructure boom triggers NAND shortage, memory profits seen rising 2–3x, ...

Elroy — 4/14/2026 7:43:10 AM

AI infrastructure boom triggers NAND shortage, memory profits seen rising 2–3x, Silicon Motion says

digitimes.com

Behind a paywall....

[Elroy] I wonder what this article says.... Silicon Motion warns AI-driven NAND sho...

Elroy — 4/10/2026 9:13:29 AM

I wonder what this article says....

Silicon Motion warns AI-driven NAND shortages will deepen in 2027, reshaping memory market

digitimes.com

[Elroy] Lots of "form 3" sec filings for SIMO today. I can't tell if it means any inside...

Elroy — 4/9/2026 5:01:28 PM

Lots of "form 3" sec filings for SIMO today.
I can't tell if it means any insider bought new stock, or they're just doing some annual filing of the amount of stock they own.