Between the AI Boom and the Battery Revolution: HPQ Silicon, Siltronic, and Aixtron Are on the Winning Side

HPQ Silicon – A Crucial Milestone Reached

The Canadians are focusing on innovations in advanced materials and critical processes. In this context, the collaboration with their French research and development partner Novacium, in which HPQ holds a 36.8% stake, is of particular importance.

The duo is driving the development of silicon-based anode materials for batteries. This approach is considered a potential key to the next generation of energy storage, as silicon-based anodes promise significantly higher capacities than conventional graphite solutions.

Most recently, HPQ announced a major success with its first order from a manufacturer of industrial and military drones, marking the first step toward commercialization. The order covers fourth-generation batteries with capacities of 10,000 to 13,400 milliampere-hours (mAh), designed for long drone flight times. HPQ has a patented process, PUREVAP, that can convert quartz into high-purity silicon in a single step.

Another field that HPQ and Novacium are addressing together is hydrogen. The French company has developed a technology that produces green hydrogen via the hydrolysis of a silicon-aluminum alloy. This is achieved without the need for electricity or infrastructure such as pipelines or tanks. The French Ministry of Defence has already expressed great interest in this mobile solution.

The Canadians have reached a milestone with the initial commercialization of the new battery generation. Further expansion and progress in the other growth areas are likely to gradually boost the share price. The share is currently trading around CAD 0.17, valuing the company at approximately CAD 70 million. However, this does not yet reflect the company's potential.

Siltronic – 60% price increase since the start of the year

Siltronic produces silicon wafers. These thin slices of high-purity silicon are processed by chip manufacturers into processors, memory chips and various components for industrial applications and AI-related uses.

The German company is among the world's largest producers. Its customer list includes the industry's blue-chip companies. The stock price has doubled over the past 12 months, with a 60% increase since the start of the year. The stock is currently trading at just under EUR 80, giving the company a market capitalization of EUR 2.3 billion. Experts at Metzler Bank foresee a positive future for the wafer market. They expect a recovery that should last several years, with signs of acceleration in the second half of this year.

The most recently published first-quarter data fell slightly short of market expectations. Revenue declined by 11%, while operating profit (EBITDA) fell by roughly twice that amount. Nevertheless, the company confirmed its full-year targets. Following EUR 1.35 billion in revenue last year, the German firm projected a decline in the mid-single-digit percentage range for 2026. The EBITDA margin is expected to range between 20% and 24%. As is often the case with dynamic price movements, when the market prices in future growth, analysts struggle to keep up with price targets. On average, experts calculate a price target of just EUR 63.

Aixtron – 170% Performance, and Now?

The stock has gained nearly 170% this year alone. The market is focusing on the potential associated with AI. The latest quarterly figures, which were weak on their own, reflect the heterogeneity of products and customer segments.

The company viewed the rising order intake in the first quarter as evidence of the long-term and structural AI demand trend already taking hold. This tailwind recently prompted management to raise its guidance for the current year. Revenue of EUR 530 to 590 million is now projected, up from the previous estimate of EUR 40 million less. Similarly, the bar for the EBIT margin has been raised by 1 percentage point to 17-20%.

Aixtron manufactures equipment used to produce specialized semiconductor materials. This primarily includes gallium nitride (GaN), which can handle higher voltages, temperatures, and switching speeds compared to silicon. A second field is optoelectronics. This involves components that convert electricity into light or vice versa. Examples include LEDs, lasers, and optical data transmission. These technologies are crucial for fiber-optic communication, sensor technology, and AI data centers, which are increasingly relying on optical connections.

HPQ Silicon operates in dynamic growth sectors such as advanced materials and energy storage. The commercialization of innovative silicon batteries, which offer significantly higher capacities than traditional graphite solutions, is progressing. Additionally, there are other promising growth areas. The stock has not yet reflected this potential. Siltronic is benefiting from AI-driven chip demand but is struggling with weak demand from traditional industries. Investors are betting on strong growth in future-oriented sectors with Aixtron.