We are two weeks into the earning season and we want to provide our readers with some high-level takeaways so far based on what we learned:

• Cloud remained strong and datacenter spending is back. AWS growth in Q4'19 remained strong at 34% YoY, Microsoft Azure reaccelerated to 64% YoY growth. Cloud providers' spending recovered after 4 quarters of slowing down.  Intel saw data center revenue grew 19% YoY in December quarter, while AMD grew 70%+ from a much smaller base based on our estimates.

• 5G infrastructure is taking a pause after a few quarters of strong build-out. Texas Instruments management kept repeating communication infrastructure is a lumpy business when the unit was on fire a year ago growing at a 30% YoY rate. It appears that after a few quarters of strong build-out, carriers around the world are taking a pause on deployment, driving a broad-based slow down of communication-related revenue for the companies we track. Xilinx is hit particularly hard and the company decided to cut 7% of its workforce. Ericsson, Corning,Skyworks, and Teradyne all echoed the same sentiments.

• However, 5G smartphones remained strong. Skyworks expects its mobile business to return back to growth after 6 quarters of decline. Qorvo saw their mobile business returning to growth in December, projecting a very strong March quarter for the business and continued to see 300M 5G smartphones shipped in 2020. We entertained the idea that we might see a synchronized development work on 5G rollout, rather than a sequential road map that played out in the 4G cycle. Stay tuned!