Art of Speculation
Chinese-Language AI Fundamentals & Macro, Concentrated Investing
Lenovo's strong results answer the two biggest worries about AI servers, demand and profitability, which lifted Dell, HPE and Super Micro. Lenovo's Q1 revenue rose 43% to $26.94B, above the $22.3B expected, and adjusted net profit rose 176%. Its infrastructure group nearly doubled revenue with about $777M of operating profit, and its AI server pipeline reached $54B, up 157% from $21B last quarter, showing no cooling in demand and that AI servers become profitable at scale. x.comÂ
Super Micro is the most mispriced AI server vendor at about 0.3x FY27 sales, if its gross-margin recovery to roughly 18% holds. Q4 revenue rose 93% to $11.1 billion, EPS of $1.70 beat $0.96, and FY27 revenue guidance of $65-72 billion beat the $53.1 billion expected, on over $60 billion of new orders. Dell trades at 2.1x sales and HPE 1.8x. Base cases: Super Micro $50-70, Dell $360-450, HPE $50-60. Management credits favorable mix, so 18% may not last. x.com x.comÂ
Enterprise and neocloud demand is creating a second wave of AI infrastructure spending, with tailwinds for Nvidia and Super Micro. Dell forecasts 200 GW of AI data center growth through 2030, half driven by these customers, and estimates a $1 trillion AI infrastructure opportunity over the next four years. AI servers could enter a new growth phase in 2027, with higher shipment volumes and more revenue per deployment. x.comÂ
Dell should benefit from AI data-center construction because builders say almost every new facility runs on Dell or Super Micro servers. Sales rose 49% in the past year to $151B; Dell is 18% below its high and is an easy double from here. x.comÂ
Memory costs remain an unresolved risk for Dell even after a quarter that proved the pre-earnings bearish lean wrong. Gross margin rose to 20.9% from 17.8% and the October quarter was guided to $49.0bn, but AI server revenue grew just 1.7% while backlog jumped to $95bn, so a mix shift toward traditional servers and storage flattered margin. The $74bn full-year AI target needs about 26% sequential AI growth, so memory costs hit the October quarter on a richer AI mix, still unquantified. x.com … Show more
Dell's AI server business is exploding. Revenue grew 88%, its fastest since returning to public markets, driven by AI infrastructure demand; AI server revenue rose 757% year over year to $16.1B, and management raised full-year AI server revenue expectations to over $60B. x.comÂ
Dell sits in the layer that turns GPUs into working AI factories, so it wins as AI demand moves from model headlines into installed infrastructure. AI server revenue rose 757% to $16.1B, Infrastructure Solutions Group revenue rose 181% to $29B, and total revenue grew 88% to $43.8B. Dell booked $24.4B of AI orders and raised its FY27 AI server revenue target to about $60B. GPUs still need server design, integration, networking, storage, cooling and deployment. x.comÂ
Dell and HPE are priced on an AI-server story rather than their businesses. Like HP Inc., which just posted weak results on rising memory costs and thinner PC margins, they are cyclical hardware companies dependent on enterprise capex, yet their shares diverged only because of the AI-server label. Data center demand is real, but the premium has run far ahead of it. Such pricing can last long in a liquid, risk-on market, as in 1999 and 2021, so a drop is not imminent. x.comÂ
Dell's AI server business is growing on a trajectory that should appeal to anyone who likes Nvidia's, driven by a massive public and private AI factory buildout with a huge number of racks still to sell. Revenue rose 58% to $47B and infrastructure revenue 89% to $31.8B. AI server orders hit a record $60.9B in the quarter and $131.7B over four quarters, with AI backlog at $95B and the pipeline multiples of that. AI customers exceed 6,500, and traditional servers and networking grew 122%. x.com … Show more
Dell's AI demand keeps accelerating and broadening: it booked a record $60.9 billion of AI orders this quarter and over $130 billion in 12 months, as revenue rose 58% to $47 billion and EPS 203% to $7.04. Demand spans neoclouds, sovereigns and enterprises, with AI tailwinds in traditional servers, networking and storage as agentic workflows need CPU capacity. Management sees AI at 75% of data-center demand by 2030 and a trillion-dollar-plus opportunity; DRAM and NAND remain the constraints. … Show more
Dell still looks expensive at about 20x FY28 estimated EPS, since the expected AI server guidance raise to about $75bn is already priced in; the rating stays Hold. Fiscal Q2 looks soft, with revenue estimated at $42.2bn versus a $44.5bn guidance midpoint and EPS of $4.70 versus $4.84 consensus. NVL72 shipment estimates are cut, enterprise and PC demand show early cooling, and Hon Hai is winning more SpaceX Rubin orders. Tier-2 neocloud buildouts and Vera CPU racks are positives. x.comÂ
Super Micro's enterprise data-center demand is boosting margins because that business has better margins than AI racks. Revenue rose 10% quarter on quarter and 90% year on year, net income rose 142% quarter on quarter, and gross margin jumped 76% quarter on quarter. Demand remains hot, and its forecast remains bullish. x.comÂ
