I bought $soi and then sold it , the reason being that I expect mobile phone sales to continue falling especially cheap phones will fall the most in production . Mobile division is 56% of $SOI revenue . Due to the memory shortage, cheap phones are lowest priority for memory, which will be allocated first to highest payers like data centres , laptops and expensive mobiles . A deep dive using Grok said this lowers the upside quite substantially. I could be wrong , if I am please let me know ??
No I think you're right, but not when it comes to the upside. The market knows this, it prices the future not the past. The lower smartphone vertical has been said times and times again during the calls and Q4 CEO said they expected to cut production ~50% more. The market priced this already hence the actual >2x sales, stocks move before fundamentals.
So to my opinion, the downside from this is settled. Now if it gets worst, sure we could see pressure but worst than 50% reduction is tough to see. Could happen.
In the meantime, you have a new vertical planned to grow ~30% CAGR or more over the next years, confirmed to be substantial without ends in sight as clients are pouring in.
You are talking about a EUR ~90M revenues in the face of a billions dollar AI datacenter market. Not to say they will make billions but this is the size of the total market, and it passes by SOI. If we start to see a real 10%+ sequential and accelerating growth in this vertical - which was the case this last quarter, the market will price the future.
And the future is growth acceleration in a critical AI infrastructure vertical. If memory goes to datacenters, SOIs also will. And that's for the better.
appreciate all the free alpha. Ignore the dummies on X.
No dummies on here, hence the volume and focus on the content. Not going to change :)
Great article, I’ve not seen too many people taking this angle yet and you’ve explained it really well
Appreciate it! Glad you liked it.
great breakdown
Thanks! Glad you liked it
I bought $soi and then sold it , the reason being that I expect mobile phone sales to continue falling especially cheap phones will fall the most in production . Mobile division is 56% of $SOI revenue . Due to the memory shortage, cheap phones are lowest priority for memory, which will be allocated first to highest payers like data centres , laptops and expensive mobiles . A deep dive using Grok said this lowers the upside quite substantially. I could be wrong , if I am please let me know ??
No I think you're right, but not when it comes to the upside. The market knows this, it prices the future not the past. The lower smartphone vertical has been said times and times again during the calls and Q4 CEO said they expected to cut production ~50% more. The market priced this already hence the actual >2x sales, stocks move before fundamentals.
So to my opinion, the downside from this is settled. Now if it gets worst, sure we could see pressure but worst than 50% reduction is tough to see. Could happen.
In the meantime, you have a new vertical planned to grow ~30% CAGR or more over the next years, confirmed to be substantial without ends in sight as clients are pouring in.
You are talking about a EUR ~90M revenues in the face of a billions dollar AI datacenter market. Not to say they will make billions but this is the size of the total market, and it passes by SOI. If we start to see a real 10%+ sequential and accelerating growth in this vertical - which was the case this last quarter, the market will price the future.
And the future is growth acceleration in a critical AI infrastructure vertical. If memory goes to datacenters, SOIs also will. And that's for the better.