Robust Earnings from SpaceX and Supermicro Alleviate AI Investment Concerns
Semiconductor Exports Skyrocket Over 220%; Samsung Electronics and SK hynix Lead Index Gains
Key Market Trends
① Strong Earnings by SpaceX and Supermicro Confirm Tangible AI Demand
SpaceX's post-market earnings significantly outperformed market expectations.
Revenue reached $14.58 billion, beating the consensus estimate of $127 billion [Note: $12.7B], while its AI segment continued to expand.
By turning a profit, projecting confidence in future profitability, and raising its capital expenditure outlook, SpaceX partially eased recent anxieties surrounding the sustainability of AI investments.
Data center-related firm Supermicro also reported preliminary first-quarter revenue of approximately $19 billion, a 3.8-fold increase year-on-year.
Surpassing its previous guidance of $15 billion, the results demonstrated robust on-the-ground demand despite ongoing debates over AI infrastructure spending.
Both companies surged in after-hours trading, lifting domestic investor sentiment toward AI and semiconductor shares.
② Semiconductor Exports Surge 220%; Samsung Electronics and SK hynix Rally
Amid buoyant export figures for the first 20 days of October, semiconductor exports skyrocketed more than 220% year-on-year.
Contrary to fears regarding slowing AI investments, the data underscored that robust chip demand is extending firmly into the fourth quarter.
Samsung Electronics and SK hynix posted sharp gains, spearheading the KOSPI’s advance.
Buying concentrated heavily on large-cap chipmakers, with the two stocks accounting for approximately 90% of the entire KOSPI index rise.
Semiconductor supply-chain stocks, construction, airlines, and select pharmaceutical shares also showed strength.
Foreign investors turned to net buyers, focusing primarily on electrical and electronics, while making modest purchases in chemicals, transportation equipment, construction, and finance.
Institutional investors net bought electrical and electronics, pharmaceuticals, and finance, while channeling inflows into semiconductor-related sectors on the KOSDAQ.
③ U.S.-Iran Negotiation Hopes Ease Oil Price Pressures
Hopes for a cooling geopolitical situation in the Middle East also provided a positive boost to sentiment.
International oil prices declined following reports that Pakistan, acting as a mediator, had delivered a compromise proposal to Iran for negotiations with the United States.
The proposal reportedly includes the payment of interest on frozen funds and permission to visit nuclear facilities.
Reports that both sides had pre-approved the proposal helped alleviate Middle East-driven crude oil pressures that had recently weighed on the stock market.
During the session, Australian data center operator NextDC lowered its earnings outlook due to power-securing issues and other factors, causing its shares to plunge more than 40% and briefly rattling AI-related stocks.
Supply and Demand by Sector
Foreign investors turned to net buyers, centering on electrical and electronics. Chemicals, transportation equipment, construction, and finance also saw buying dominance.
Institutional investors net bought electrical and electronics, pharmaceuticals, and finance, while targeting semiconductor-related sectors on the KOSDAQ.
Samsung Electronics and SK hynix led the index higher, with semiconductor materials and equipment (sobujang), construction, aviation, and select pharmaceutical shares showing strength.
Conversely, as capital concentrated heavily on large-cap semiconductor stocks, neither market was short on declining issues.
Market Analyst's Perspective
Recently, the market has swung violently with every single piece of AI-related news. In particular, successive negative forecasts—premised on potential financing shortages and investment delays in data center construction—weighed heavily on investor sentiment.
Today, data pointing in the opposite direction emerged. The earnings reports from SpaceX and Supermicro demonstrated that AI and data center investments are translating into actual revenue growth. Domestically, South Korea's semiconductor exports surging over 220% through October 20 confirmed that physical demand remains robust.
Of course, issues regarding data center power supply and financing, as highlighted by the NextDC case, warrant continued monitoring. Ultimately, going forward, whether actual corporate earnings estimates are being downgraded matters far more than broad forecasts on AI spending. To date, no clear downward trend has emerged in earnings projections for domestic semiconductors.
Moreover, recent market pullbacks have been substantial. As of the previous close, SK hynix had fallen roughly 60% from its peak, bringing its price-to-earnings ratio (PER) based on this year's projected earnings below 4x. While continuing to monitor AI-related headwinds, it is also time to assess the depth of the sell-off, which has created a wide divergence from actual corporate fundamentals. Investors should continue to track the momentum of recently strong sectors and fundamentally improving stocks.
Source: Market Analyst's Stock Story (t.me/shmstory)
YouTube: Market Analyst TV www.youtube.com/@blueoak1004
This article has been reorganized from a Telegram post by Market Analyst's Stock Story with the author's consent. All content may contain errors and does not constitute a recommendation to buy or sell, nor can it be used as a basis for trading. Under no circumstances may the contents of this post be used as legal grounds.
