Written by: Rita
The second-quarter earnings reports from the four major cloud providers sent a consistent signal: capital expenditures are still rising. Amazon raised its 2026 cash capex guidance from $200 billion to $220 billion, Google increased its range from $180–190 billion to $195–205 billion, and Meta narrowed its range to $130–145 billion. TSMC raised its full-year revenue guidance from “growth exceeding 30%” to “slightly above 40%,” and increased its capital expenditure guidance from $52–56 billion to $60–64 billion. In a research report on July 31, Goldman Sachs noted that the transmission chain—from cloud providers to wafer fabs to equipment suppliers—is strengthening, with semiconductor equipment makers like ASML being direct beneficiaries.
Goldman Sachs has outlined the growth rationale for five European companies. ASML benefits from demand for EUV and advanced DUV systems; ASMI benefits from increased ALD and epitaxy demand driven by investments in advanced logic and DRAM; BESI benefits from the growing adoption of custom chips and investments in advanced packaging. Nebius benefits from the widening gap between computing power supply and demand, while Technoprobe benefits from increased accelerator volumes and higher test intensity. Goldman Sachs believes that AI capital expenditures are expanding, custom chip adoption is rising, and advanced packaging is evolving—enabling equipment suppliers to gain across multiple dimensions.
Cloud providers raise their CapEx again, securing long-term demand with custom chip orders.
In its fourth quarter, Microsoft surpassed 30 million paid Copilot seats, adding 10 million net new seats in the quarter—double the increase from the previous quarter. Azure revenue exceeded $100 billion, up 41% year-over-year. Goldman Sachs believes that enterprise AI adoption is translating into actual revenue, which is a prerequisite for sustained expansion of infrastructure investment.
Amazon raised its 2026 cash capex guidance from $200 billion to $220 billion, expecting available power capacity to double by the end of 2027 compared to 2025. The Trainium chip has secured multi-year, multi-gigawatt commitments from Anthropic and OpenAI. AWS’s backlog has reached $496 billion, representing over 100% year-over-year growth.
Google Cloud revenue growth accelerated to 82%, with backlog nearing $514 billion. 2026 capex guidance raised to $195–205 billion; management reaffirmed that spending in 2027 will “significantly increase.” Meta narrowed its 2026 capex guidance to $130–145 billion and partnered with BlackRock to develop a 1 GW data center.
Goldman Sachs particularly highlighted the trend toward custom chips. Amazon's Trainium has secured multi-year commitments from major clients, Google's TPU has directly contributed to backlog growth, and Microsoft is expanding its deployment of in-house chips. Custom chips will not replace NVIDIA, but they will create new incremental demand for advanced packaging and test equipment.
Wafer fabs and memory suppliers confirm supply constraints, with WFE estimates expected to be further revised upward.
TSMC raised its 2026 revenue guidance from "over 30% growth" to "slightly above 40%," driven primarily by HPC and AI. Capital expenditures were increased from $52–56 billion to $60–64 billion, with investments over the next three years expected to be "significantly higher" than the prior cycle. Spending is focused on the N2 node and beyond, advanced packaging, and A14 mass production in 2028.
Samsung’s management expects memory supply constraints to intensify through 2027 and persist into 2028. Long-term agreements already cover five major global data center customers, with additional negotiations underway that could ultimately cover 60% to 70% of planned capacity. Goldman Sachs believes the increased LTA coverage improves visibility into future investment needs.
Estimates for WFE (Wafer Fabrication Equipment spending) are also being raised. Lam Research has increased its 2026 WFE forecast from $140 billion to a range of $150 billion, while KLA has similarly raised its forecast to exceed $150 billion, viewing $190 billion as a reasonable level for 2027. Goldman Sachs’ U.S. team forecasts WFE at $141 billion, $186 billion, and $208 billion for 2026, 2027, and 2028, respectively. Goldman Sachs believes that China’s WFE spending in 2026 will remain flat or see slight growth and will not be a drag.
ASML, ASMI, and BESI benefit directly, while Nebius and Technoprobe are also part of the supply chain.
Goldman Sachs has individually analyzed the transmission logic for five companies.
ASML: TSMC's upward revision of investments and memory capacity expansion are driving demand for EUV and advanced DUV. As we move from N2 to smaller nodes, each generation requires more lithography layers. Goldman Sachs also specifically addressed market concerns about new entrants in the lithography field. Even a seasoned competitor with decades of experience in dry DUV lithography failed to successfully transition to immersion DUV, as the difficulty of manufacturing immersion DUV systems is far greater than the market realizes, let alone EUV.
ASMI: Advanced logic and DRAM investments are driving demand for ALD and epitaxy. Gate-all-around (GAA) technology is expanding the applications of ALD, while memory manufacturers are increasing capacity. TSMC’s long-term node roadmap and Samsung’s continued focus on memory provide visibility into growing process intensity.
BESI: The adoption of customized chips and investment in advanced packaging are expanding the range of equipment applications. TSMC is increasing capacity for advanced packaging, with in-house accelerators such as TPU, Trainium, and Maia scaling up production. Chiplet architectures and advanced packaging require more chips to undergo processes like backside interconnects and hybrid bonding, and BESI’s assembly portfolio covers these steps.
Nebius: Cloud providers continue to expand their capacity, widening the gap between computing supply and demand. Demand is spreading from large model developers to enterprise workloads, and Nebius is increasing its capacity while acquiring more enterprise customers.
Technoprobe: Increased production capacity in foundry and memory drives acceleration in accelerator volumes, leading to higher demand for probe cards. The greater the number of custom chips, the higher the demand for customized probe cards. Chiplet architectures and advanced packaging increase testing intensity, elevating the importance of identifying faulty chips before packaging—where probe cards play a core role.
Cloud providers' capital expenditures continue to rise, and semiconductor foundries have raised their revenue and capex guidance. Memory manufacturers believe supply constraints will persist until 2028, and WFE estimates are also being revised upward. Goldman Sachs assesses that the transmission chain of AI-related capital expenditures is progressively strengthening—from cloud providers to foundries to equipment suppliers—with each link confirming demand. ASML, ASMI, and BESI occupy critical positions in lithography, deposition, and packaging & testing, respectively, while Nebius and Technoprobe are capturing incremental demand in their respective niche segments. The market’s focus on AI chips remains concentrated on NVIDIA and custom chips, potentially underestimating the duration and breadth of benefits accruing to upstream equipment suppliers.
Disclaimer: This article is a compilation and interpretation by Chaoxiang Research of a third-party brokerage research report (Goldman Sachs, July 31, 2026), combined with publicly available market information. The ratings, price targets, earnings forecasts, and related judgments cited herein reflect the views of the brokerage’s analysts and represent the position of their respective institution, not the views of Chaoxiang Research, nor do they constitute any investment advice. The market carries risks; decisions must be made independently. This article should not be used as a basis for buying or selling any securities.