On Wednesday, stocks of companies operating in the artificial intelligence infrastructure sector rose after CoreWeave, Super Micro Computer, and Nebius Group published quarterly results that exceeded analyst forecasts. This rise also led to an increase in the performance of server manufacturers, memory suppliers, and companies producing optical components within a single trading session.
Nebius Leads in Growth, CoreWeave Closes Behind
Shares of Nebius Group (NBIS) were among the day's top gainers, rising approximately 23% to $238.47 after the neo-cloud solutions provider reported quarterly revenue that significantly exceeded analyst expectations. Shares of CoreWeave (CRWV), a company specializing in artificial intelligence cloud solutions, rose approximately 19% and traded at $107.87.
Super Micro Computer (SMCI), a manufacturer of artificial intelligence server hardware, showed a 13% increase to $35.80, and the published forecast, according to reports, led to a stock price increase of more than 6% solely due to that outlook.
Hosting service prices for companies using artificial intelligence, including Applied Digital (APLD) and IREN (IREN), also increased.
CoreWeave Faces Order Processing Delays
CoreWeave's backlog exceeded $100 billion, which is approximately 50% higher than in the previous quarter, and CoreWeave reported receiving orders from clients worth an additional $25 billion after the quarter ended.
In a Yahoo Finance video, Adrian Helfert, Chief Investment Officer of Westwood, manager of the ETF Enhanced Income Opportunity, explained how CoreWeave is financing this growth. According to Helfert, the company financed its latest bond issuance "at a price of nine and 5/8," noting that the cost of capital is one of the key concerns in this sector.
Power Supply Constraints Remain a Limiting Factor
According to Helfert's estimate, Supermicro's quarterly results significantly exceeded the company's production capacity. Supermicro informed investors that it would have received more orders if not for constraints in "power supply, cooling, and energy supply," and it is this shortage that allows the company to raise prices. As a result of the price increases, profitability was significantly higher than the company's own expectations.
Helfert described a market where the limiting factor is supply, not demand or the desire to purchase the products. These comments came as investors continue to support companies supplying computing power, server racks, and cooling systems, rather than the artificial intelligence applications themselves.
Price Increases Affect Memory, Optics, and Overseas Markets
Market ripples extend far beyond CoreWeave or SuperMicro. Lumentum (LITE), a manufacturer of optical and photonic components for data centers, rose after its fourth-quarter fiscal year revenue more than doubled, reaching $1.01 billion, while prices for competitors Coherent (COHR) and Ciena (CIEN) also increased.
In the memory and storage industry, the Roundhill Memory ETF (DRAM) rose 4%, shares of Micron (MU) and Sandisk (SNDK) also gained 4%, and the South Korean company SK Hynix (SKHY) showed price increases.
The South Korean Kospi index tracked its best performance in August, linked to Deutsche Bank's confidence that financial results confirm the presence of AI demand. Investors will now watch for Nvidia (NVDA), which will publish its financial results on August 26th.
