Dutch asset management firm Robeco forecast on May 14 that the memory semiconductor cycle led by Samsung Electronics and SK Hynix will extend beyond historical patterns. At a press conference held in Seoul, Chris Berkouwer, Deputy Head of Global Stars Equity Strategy at Robeco, stated that three factors support this outlook: sovereign AI strategies by governments diversifying the customer base beyond Big Tech, production capacity unable to meet doubled demand, and long-term supply agreements (LTA) structuring contracts for sustained profit growth. Robeco manages $396 billion in assets.
Robeco Identifies Three Factors Extending Memory Semiconductor Cycle
Chris Berkouwer stated at the May 14 press conference that the Korean semiconductor industry, while cyclical, will see an extended cycle. He cited three specific factors. First, central governments' strategic prioritization of artificial intelligence has broadened the customer base beyond Big Tech companies to include nations pursuing sovereign AI initiatives. Second, the memory semiconductor industry currently cannot meet demand growth even if production capacity doubles, a situation confirmed by SK Group Chairman Chey Tae-won. Third, contract structures have shifted toward long-term supply agreements that enable sustained profit growth. Berkouwer stated, "These factors will extend the memory cycle toward long-term profit growth."
Berkouwer Dismisses AI Chip Peak-Out Concerns
Berkouwer rejected concerns about an AI semiconductor peak-out. He stated, "The peak has not arrived," and added, "The growth runway will continue for many years ahead." He noted that other sectors with strong fundamentals show valuation-fundamental gaps, making their risk-reward profiles favorable at the current time.
Crabb Forecasts Sustained Volatility in AI-Heavy Markets
Joshua Crabb, Head of Asia-Pacific Equity at Robeco, addressed recent volatility in the KOSPI index. He stated, "Markets with very high AI exposure will likely maintain high volatility for some time," adding that questions about cycle strength and post-cycle outcomes will persist. Crabb recommended partial diversification into undervalued stocks, high-dividend stocks, and companies conducting share buybacks as an effective strategy in volatile AI markets. Regarding Korean semiconductor companies that are both AI stocks and undervalued, Crabb stated that the period when earnings turn negative will be a critical inflection point. He explained that if investors confirm reduced cyclicality in semiconductor companies compared to the past, they may rediscover the undervaluation appeal of semiconductor stocks.
Robeco Plans to Increase Global Equity Allocation in H2 2026
Robeco plans to increase allocations to global equities and emerging market bonds in the second half of 2026. The firm will reduce exposure to commodities including gold and crude oil.
FAQ
What did Robeco forecast about the memory semiconductor cycle on May 14?
Robeco forecast that the memory semiconductor cycle led by Samsung Electronics and SK Hynix will extend beyond historical patterns due to three factors: government sovereign AI strategies diversifying customers, production capacity unable to meet doubled demand, and long-term supply agreements structuring contracts for sustained profit growth.
Why did Chris Berkouwer dismiss AI chip peak-out concerns?
Berkouwer stated that the peak has not arrived and the growth runway will continue for many years ahead. He noted that while other sectors show favorable risk-reward profiles due to valuation-fundamental gaps, the AI semiconductor cycle remains intact.
How does Joshua Crabb recommend investors respond to volatility in AI-heavy markets?
Crabb recommended partial diversification into undervalued stocks, high-dividend stocks, and companies conducting share buybacks. He stated that markets with high AI exposure will likely maintain high volatility, making diversification an effective strategy.
