Japan Semis Earnings Preview (3Q CY26): Buy the dip, anyone?

We preview the upcoming 3Q CY26 quarterly results season for Japanese semiconductor companies based on a set of data sources that we track and proprietary methods to derive the expected results. Not the best set up into the print: market has been weak into the year-end; we have not been constructive on the near term since Sep. Result beats didn't lead to good market reactions (ASML, TSMC), so we worry about potential misses, which our tracking data shows for several companies with no significant beats suggested. Our Japan Semi coverage is still up 42% YTD even after a 26% pullback QTD, and we believe the recent pullback has created a more favorable risk-reward into next year. For SPE, we focus on guidance raises and would position for Advantest and Kokusai long; Lasertec may also raise order guidance but expectations are already high, while TEL and Screen are tracking behind consensus. For non-equipment names, Hoya is preferred, followed by Renesas;