Latest news with #Blackwell
Yahoo
2 hours ago
- Business
- Yahoo
Super Micro Stock Surges Before Q4 Earnings. Is A Correction Coming?
Super Micro Computer (SMCI) will announce its fourth quarter fiscal 2025 financial results on Tuesday, Aug. 5. SMCI stock has been on a tear ahead of Q4 earnings, rallying 63.7% over the past three months. This reflects a sharp rebound that signals the market's renewed confidence in the company's AI-driven future. Fueling the recent surge is robust demand for Supermicro's AI solutions, which are critical components in high-performance computing infrastructure. The stock received an additional boost from a $20 billion partnership with Saudi Arabia-based DataVolt. This strategic deal expands Supermicro's global footprint and fortifies its pipeline for future growth. More News from Barchart Tesla Just Signed a Chip Supply Deal with Samsung. What Does That Mean for TSLA Stock? Here's What Happened the Last Time Novo Nordisk Stock Was This Oversold Dear Microsoft Stock Fans, Mark Your Calendars for Aug. 1 Markets move fast. Keep up by reading our FREE midday Barchart Brief newsletter for exclusive charts, analysis, and headlines. The recent momentum marks a significant turnaround for a company that, just last year, found itself in the crosshairs of short-seller Hindenburg Research. The report leveled serious allegations, including accounting irregularities, causing SMCI shares to tumble. The situation escalated when Super Micro delayed its annual SEC filings, raising concerns over possible delisting from the Nasdaq Exchange. However, the company managed to weather the storm. By submitting its overdue financials, Super Micro narrowly avoided a delisting and has since regained the market's trust, as reflected in the recent rally in its price. Still, the road hasn't been entirely smooth. In its fiscal third quarter, Super Micro reported $4.6 billion in revenue, falling short of expectations. Management pointed to a temporary pause in purchasing as customers considered whether to invest in Nvidia's (NVDA) existing Hopper GPUs or wait for the next-generation Blackwell platform. As a result, certain orders were deferred, although the company expects many of those deals to materialize by the end of September. Given the recent rally, it's clear the market is already pricing in acceleration in Super Micro's top-line growth in Q4. That sets the bar high for the upcoming earnings report. Any signs of continued hesitation in AI infrastructure spending or a cautious tone from management could trigger notable volatility in SMCI shares. AI-Driven Demand to Boost SMCI's Growth Super Micro's top line could continue to benefit from high AI-driven demand. The company's management expects its top line to be in the range of $5.6 billion to $6.4 billion, reflecting an increase of 5% to 21% over the $5.3 billion reported in the same quarter last year. The increase in sales of its server and storage systems, primarily driven by the rise in demand from customers for GPU servers, high-performance computing, and rack-scale solutions, will drive its revenue. This top-line growth will likely be driven by the rising demand for SMCI's GPU servers and high-performance computing systems. As AI applications become more sophisticated and widely adopted across industries, both enterprise clients and cloud service providers are leaning heavily on SMCI's server and storage solutions. AI GPU platforms accounted for more than 70% of the company's revenue in Q3, reflecting the solid demand for its platform. The company's future pipeline looks promising, with strong momentum in design wins and customer interest. SMCI is ramping up production of its Data Center Building Block Solutions (DCBBS), built on new-generation GPU platforms, which will accelerate future growth. Further, SMCI is a leader in energy-efficient computing, especially through its direct liquid cooling (DLC) technology. Last year, it delivered 4,000 high-powered AI racks equipped with DLC, significantly reducing energy costs for clients. With its next-generation cooling solution DLC-2 on the horizon, SMCI is well-positioned to drive further adoption as companies become increasingly focused on sustainability and cost efficiency. While revenue is expected to climb, its profit margins could remain under pressure. Management has flagged higher inventory reserves for older-generation products as a concern during the Q3 conference call, and gross margin is projected to dip to around 10%, down from 11.2% a year earlier. On the earnings front, the company expects earnings per share (EPS) in the range of $0.40 and $0.50 in Q4. Analysts expect the company to report EPS of $0.35, which reflects a 36.4% year-over-year decline. Analysts' Recommendation for SMCI Stock Ahead of Q4 Earnings Wall Street analysts, while acknowledging the company's momentum, remain conservative. The consensus rating on SMCI is 'Hold,' and the average price target of $43 suggests the stock could see a pullback of more than 25% from current levels. The Bottom Line Super Micro has made a strong comeback from past regulatory and reputational challenges, positioning itself as a key player in high-performance and energy-efficient computing. However, with Q4 earnings on the horizon and the recent rally in its price, expectations are sky-high. Any signs of margin pressure, deferred orders, or cautious management commentary could prompt a sharp correction. While the long-term growth narrative remains intact, SMCI could remain highly volatile in the short term. On the date of publication, Sneha Nahata did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
5 hours ago
- Business
- Yahoo
Is SMCI Stock the Next NVIDIA, and Is It Worth Buying?
Following a challenging second half of 2024, investors have expressed a positive outlook on Super Micro Computer, Inc. SMCI, with its shares gaining 97% this year and outpacing NVIDIA Corporation's NVDA gain of 31.6%. So, can Supermicro, a manufacturer of data center components, become the next NVIDIA, and is it a worthwhile investment? Let's explore –- Behind SMCI's Gains This Year and Growth Potential Supermicro's shares surged 10% on Monday after Digi Power X announced a provisional patent for its ARMS 200 modular data center, with SMCI as its exclusive server supplier. The choice of Supermicro indicates that the company may be leveraging advanced, high-value technology. A short-seller tarnished Supermicro's reputation last year, but the stock rebounded to finish the first half of 2025 with a 60.8% increase. This rebound occurred after the company's new auditor, BDO, reviewed the last three years of financial transactions and confirmed that Supermicro's financial statements are fair in all material respects. The company was cleared of all allegations of fraud. Supermicro's shares gained further after the firm announced a $20 billion deal with Saudi Arabian data center operator DataVolt. This deal is part of the Trump administration's strategic partnerships with Saudi Arabia. In the March quarter, Supermicro's revenue growth fell short of market expectations, possibly due to delays in shipments of NVIDIA's Blackwell chips. However, no delays are expected for the June quarter, which could boost Supermicro's revenues and positively influence its share price. Remember, most of the graphics processing units (GPUs) used in Supermicro's systems are NVIDIA chips. Could SMCI Be the Next NVIDIA? Supermicro's gains this year have sparked questions about whether it can replicate NVIDIA's future success. Supermicro's business, which involves integrating several third-party components, is much easier to commoditize compared to NVIDIA's operations. However, developers prefer NVIDIA's CUDA software and artificial intelligence (AI) GPUs over competitors like Intel Corporation INTC and Advanced Micro Devices, Inc. AMD. NVIDIA's products are distinctive and superior to those of its rivals, but some competitors also offer Supermicro's direct liquid cooling method. Additionally, NVIDIA controls over 80% of the AI GPU market, boosting its pricing power. In contrast, Supermicro has only an 8% share in the AI server market, making it premature to crown Supermicro as the next NVIDIA (read more: Is Rigetti the Next NVIDIA, and Should You Buy the Stock?). Should You Buy SMCI Stock Now? Despite recent gains, investors should remain cautious. Major technology vendors are providing intense competition to Supermicro, which is putting pressure on the company's margins. Supermicro's non-GAAP gross margin for the fiscal 2025 third quarter was 9.7%, down from 11.8% in the previous quarter and 15.5% in the same quarter last year. Supermicro also has a debt-to-equity ratio of 38.1%, higher than the Computer- Storage Devices industry average of 32.5%, indicating greater financial risk and increased vulnerability to economic downturns. Nonetheless, the company's growth may be impacted by trade-related uncertainties. Image Source: Zacks Investment Research Supermicro, currently, has a Zacks Rank #5 (Strong Sell), and the Zacks Consensus Estimate of $2.07 for SMCI's earnings per share (EPS) is down by 39.7% from a year ago. Image Source: Zacks Investment Research You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Intel Corporation (INTC) : Free Stock Analysis Report Advanced Micro Devices, Inc. (AMD) : Free Stock Analysis Report NVIDIA Corporation (NVDA) : Free Stock Analysis Report Super Micro Computer, Inc. (SMCI) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Time of India
9 hours ago
- Automotive
- Time of India
Nvidia orders 300,000 H20 chips from TSMC due to robust China demand
Nvidia placed orders for 300,000 H20 chipsets with contract manufacturer TSMC last week, two sources said, with one of them adding that strong Chinese demand had led the US firm to change its mind about just relying on its existing stockpile. The Trump administration this month allowed Nvidia to resume sales of H20 graphics processing units (GPUs) to China, reversing an effective ban imposed in April designed to keep advanced AI chips out of Chinese hands due to national security concerns. Nvidia developed the H20 specifically for the Chinese market after US export restrictions on its other AI chipsets were imposed in late 2023. The H20 does not have as much computing power as Nvidia's H100 or its new Blackwell series sold in markets outside China. The new orders with Taiwan's TMSC would add to existing inventory of 600,000 to 700,000 H20 chips, according to the sources who were not authorised to speak to media and declined to be identified. For comparison purposes, Nvidia sold around 1 million H20 chips in 2024, according to US research firm SemiAnalysis. Nvidia CEO Jensen Huang said during a trip to Beijing this month that the level of H20 orders it received would determine whether production would begin again, adding that any restart to the supply chain would take nine months. The Information reported after Huang's trip that Nvidia had told customers it had limited H20 stocks available and it had no immediate plans to restart wafer production for the GPU. Nvidia needs to obtain export licenses from the US government to ship the H20 chips. It said in mid-July it had been assured by authorities that it would get them soon. The US Department of Commerce has yet to approve those licenses, one of the sources and a third source said. Nvidia on Monday declined to comment on the new orders or the status of its license applications. TSMC declined to comment. The US Commerce Department did not immediately respond to a request for comment. Nvidia has asked Chinese companies interested in purchasing Nvidia H20 chips to submit new documentation including order volume forecasts from clients, said one of the sources and a fourth source. Key product in US-Sino trade war The Trump administration said the resumption of H20 sales was part of negotiations with China over rare earth magnets - elements essential for many industries and which Beijing had limited exports of as trade war tensions escalated. The decision drew bipartisan condemnation from US legislators who are worried that giving China access to the H20 will impede US efforts to maintain its lead in AI technology. But Nvidia and others argue that it is important to retain Chinese interest in its chips - which work with Nvidia's software tools - so that developers do not completely switch over to offerings from rivals like Huawei. Before the April ban, Chinese technology giants including Tencent, ByteDance and Alibaba substantially increased H20 orders as they deployed DeepSeek's cost-effective AI models as well as their own models. The popularity of Nvidia products in China, despite the advent of rival, albeit less powerful, offerings from Huawei, has been underscored by a boom in repair demand for its other banned GPUS - many of which have been smuggled into the country. After the April ban on H20 sales, Nvidia warned that it would have to write off $5.5 billion in inventories, while Huang told the Stratechery podcast that the company also had to forgo $15 billion in potential sales.
Yahoo
12 hours ago
- Business
- Yahoo
Nvidia Doubles Down With Massive H20 Order
Nvidia (NASDAQ:NVDA) just placed a fresh order for 300,000 H20 AI GPUs from TSMC (TSM) to keep pace with booming China demand. That order adds to an existing 600,000700,000 H20 chip stockpile and pushes China?bound inventory close to 1 million follows April's U.S. lift on H20 exports under the Trump administration, even though formal export licenses from the Commerce Department are still awaiting approval. Warning! GuruFocus has detected 5 Warning Signs with NVDA. The H20 was built specifically for China with pared?down compute versus Nvidia's H100 and Blackwell lines to comply with 2023 restrictions, and now it's become a linchpin in Nvidia's China play. Analysts say the order underscores Nvidia's pricing power and volume leverage in AI's hottest market. With lead times of nine months to restart H20 production, Jensen Huang has doubled down on TSMC capacity to head off domestic Chinese rivals and blunt any hiccups from export rule changes. Nvidia shares popped on the news as investors bet on strong Chinese uptake to drive another leg of growth. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Globe and Mail
12 hours ago
- Business
- Globe and Mail
NVIDIA Leads in Data Center GPU Market: Will Blackwell Keep It Ahead?
NVIDIA Corporation NVDA continues to dominate the data center market, driven by its latest Blackwell graphics processing unit (GPU) architecture. In the first quarter of fiscal 2026, the company generated $39.1 billion in revenues from the data center market, representing a 73% year-over-year increase. On the last-quarter earnings call, NVDA stated that Blackwell now contributes nearly 70% of the data center segment's compute revenues, with demand led by artificial intelligence (AI) factories and the rise of advanced reasoning models. NVIDIA's Blackwell platform, particularly the GB200, is built for large-scale AI inference. On the last earnings call, management stated that major cloud players are rapidly deploying Blackwell GPUs, nearly 72,000 GPUs per week by each hyperscaler. With stronger manufacturing yields and expanded availability, Blackwell has become NVIDIA's fastest product ramp in history. NVIDIA is also preparing to ship its next-gen GB300 during the calendar third quarter of 2025. With increased high-bandwidth memory and an efficient drop-in design, the GB300 chip promises a 50% performance boost over GB200. Early sampling has already begun at major cloud service providers. It's not only hardware that has contributed to Blackwell's success. NVIDIA's software ecosystem, including CUDA, NeMo and its inference microservices, allows developers to fully utilize Blackwell's potential. This deep integration makes switching away from NVIDIA harder for customers. As the AI wave grows and more companies build AI factories globally, NVIDIA's lead could strengthen. If Blackwell maintains its current pace and NVIDIA continues to support it with a strong ecosystem, the company's leadership in data centers is likely to continue. Our model estimates indicate that the company's revenues from the data center end-market will witness a CAGR of 30.3% through fiscal 2025 to fiscal 2028. NVIDIA Rivals AMD and Intel Up Their Game in AI Data Centers NVIDIA's major competitors, Advanced Micro Devices AMD and Intel INTC, are also stepping up their capabilities in the data center AI chip market. Advanced Micro Devices' MI300X GPUs are gaining attention for their high memory and power efficiency. Several hyperscalers are testing AMD's solutions as alternatives to NVIDIA's Blackwell, especially in cost-sensitive or specialized workloads. Advanced Micro Devices is also building a strong software stack to grab more customers. Intel is focusing on both CPUs and AI accelerators to grab a market share in the data center space. The company is promoting its Gaudi 3 AI chips as a low-cost option for training and inference. Intel is also working with major cloud providers to expand the adoption of its AI hardware. NVIDIA's Price Performance, Valuation and Estimates Shares of NVIDIA have risen around 31.6% year to date against the Zacks Computer and Technology sector's gain of 10.9%. From a valuation standpoint, NVDA trades at a forward price-to-earnings ratio of 35.84, higher than the sector's average of 27.86. Image Source: Zacks Investment Research The Zacks Consensus Estimate for NVIDIA's fiscal 2026 and 2027 earnings implies a year-over-year increase of approximately 42.5% and 32.2%, respectively. Estimates for fiscal 2026 and 2027 have been revised upward in the past 30 days. Image Source: Zacks Investment Research NVIDIA currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Higher. Faster. Sooner. Buy These Stocks Now A small number of stocks are primed for a breakout, and you have a chance to get in before they take off. At any given time, there are only 220 Zacks Rank #1 Strong Buys. On average, this list more than doubles the S&P 500. We've combed through the latest Strong Buys and selected 7 compelling companies likely to jump sooner and climb higher than any other stock you could buy this month. You'll learn everything you need to know about these exciting trades in our brand-new Special Report, 7 Best Stocks for the Next 30 Days. Download the report free now >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Intel Corporation (INTC): Free Stock Analysis Report
