Third-quarter revenue rose 31% year over year but missed expectations because of component shortages and inventory write-downs; BofA cut its earnings forecasts for the next three years and maintained its Buy rating.
Citi believes Republicans holding the Senate could push US stocks higher through year-end; a larger Democratic majority could lead markets to price in the risk of higher corporate taxes in 2028 earlier. Local elections could also affect the pace of data-center construction.
Capital spending by the major cloud and neocloud providers tracked by BofA is expected to rise 54% year over year in 2027, up from 37% before earnings season; demand for computing capacity and rental rates support expansion, while upfront investment continues to squeeze free cash flow.
Hon Hai’s collaboration with Nvidia is expanding from GPU servers to full racks, networking, power supply and cooling. Citi believes factory pre-integration and automation capabilities could expand its revenue opportunities from AI projects.
JPMorgan says European natural gas prices have returned above 100 euros per megawatt-hour, while a recovery in Russian refining could increase diesel supplies; agricultural risk premiums have fallen, and the value of energy positions has reached a record high.
Enterprise SSD solutions drove revenue and margin growth in the third quarter of 2026. The company expects revenue to grow by more than 40% in 2027; Morgan Stanley sees an opportunity in boot drives and expects working capital to continue consuming cash.
Third-quarter organic growth met Citi’s expectations, margins were better, and the company raised its margin guidance. Citi believes the worst impact of pricing competition may have passed and raised its earnings-per-share forecasts for 2026–2030.
Seagate’s nearline hard-drive shipment capacity rose just 2% sequentially in the September quarter, but its price per TB increased 16%. Morgan Stanley cut its earnings forecasts and price target but remains positive on tight supply and demand and the ramp-up of HAMR products.
AWS third-quarter revenue rose 39% year over year, below Morgan Stanley’s 42% forecast. Backlog and capital spending support the bank’s view of subsequent growth, but free cash flow is under pressure and the release of satellite business costs has also been delayed.
Third-quarter data center results drove earnings above expectations, but weak PC demand and customer inventory reductions weakened the fourth-quarter outlook. Bernstein cut its earnings forecasts and valuation multiple, lowering its price target from $110 to $75.
JPMorgan raised its data center growth expectations for SPX Technologies while anticipating near-term costs from hiring, supply chain adjustments and production ramp-up; the bank maintained its Overweight rating and 225 dollar price target.
Core CPI and PPI both rose faster month over month in September than in the prior month, but institutions disagree on whether price pressures will persist. After leveraged positions in US stocks were unwound, changes in earnings and interest rates became central to valuation assessments.
Lower sulfuric acid prices, a decline in actual copper concentrate processing fees and a high second-quarter comparison base weighed on Jiangxi Copper’s third-quarter net profit. The company expects consumption of copper concentrate under annual long-term contracts to decline further in the fourth quarter.
An improved product revenue mix helped the company maintain its gross margin, but revenue from traditional components and investment income from joint ventures both declined in the first three quarters. Citi maintained its Buy rating and 25 yuan target price.
Third-quarter shipments still fell about 3% year over year, but gross margin rose 5 percentage points quarter over quarter. Citi sees a turning point in improved efficiency at mature factories and has raised its 2027 earnings forecast by 15%.
HSBC reviews Tencent’s Global Digital Ecosystem Summit: WorkBuddy is connecting office tools with WeCom, Hunyuan Hy4 is set to launch, and Tencent Cloud’s overseas customer base doubled over the past year.
BofA expects the Bank of Japan to hold its interest rate at 1.25% in October and judge for the first time that underlying inflation has broadly reached its 2% target. The bank still expects a rate hike in December, but markets have already priced in considerable tightening.
Foxconn Industrial Internet’s cloud computing business maintained strong growth in the third quarter. Net profit exceeded the Bloomberg consensus and the expectations of buy-side investors contacted by Citi, but gross margin and net profit fell short of Citi’s own forecasts. Citi lowered its 2026 earnings forecast and sharply reduced the valuation multiple for the AI business.
Third-quarter net profit in 2026 rose 6.5% year on year, below the first-half growth rate. Citi calculates that growth was 22.7% excluding two non-recurring items; gross margin also improved, and new orders rose 5.5% in the first nine months.
Citi believes slowing process advances and HBM's use of wafer capacity will keep advanced memory supply tight; Micron also expects DRAM supply and demand to be tighter in 2027–2028 than in 2026.
