WEBVTT - Super Micro Computer, Micron Sink; Dell Rises

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio News.

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<v Speaker 2>The Stock Movers Report, your roundup of companies making moves

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<v Speaker 2>in the stock market, harnessing the power of Bloomberg Data.

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<v Speaker 1>I'm Carol Masser along with Tim Stenevik. Let's get to

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<v Speaker 1>some stocks on the move of Bloomberg News. Equities reporter

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<v Speaker 1>and deputy team leader for US Equities Carmen Reinicky is

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<v Speaker 1>in the house. We're almost there.

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<v Speaker 3>Well are we Well, yeah, we're getting there. We're getting there.

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<v Speaker 1>Some big moves though, And one name that we are

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<v Speaker 1>talking about a lot today, we're going to talk about

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<v Speaker 1>it as well.

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<v Speaker 4>Yeah, so that's super micro Micro ticker SMCI. So we're

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<v Speaker 4>down thirty two percent right now. This is the most

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<v Speaker 4>sense sort of end of October with twenty twenty four,

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<v Speaker 4>so three individuals associated with the company were indicted by

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<v Speaker 4>the US Attorney's office. So this includes the co founder

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<v Speaker 4>who's charged with smuggling chips to China. So really significant

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<v Speaker 4>here for this company. H And I also like to

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<v Speaker 4>point out here, so super Micro has had a pretty

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<v Speaker 4>rough stretch of years. So this company was almost delisted

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<v Speaker 4>in twenty twenty four, and just at the beginning of

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<v Speaker 4>twenty twenty five that was sort of resolved and it's

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<v Speaker 4>stayed listed and it stayed apart or you know, it's

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<v Speaker 4>a part of the S and P five hundred. But

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<v Speaker 4>so you know, they've had some regulatory concerns over there

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<v Speaker 4>financials and now this so just a lot of I

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<v Speaker 4>think overhangs over the stock.

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<v Speaker 2>What do they do?

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<v Speaker 4>So they're server maker, okay, and they are associated with

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<v Speaker 4>in video as well, so they've gotten they've had they

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<v Speaker 4>had a big run up because of you know, the

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<v Speaker 4>AI trade, but then also you know, struggled with some

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<v Speaker 4>other issues that led to volatility.

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<v Speaker 1>I feel like we have talked so much over the

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<v Speaker 1>last couple of years on this company of it.

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<v Speaker 3>Look, I mean the biggest suppliers for super Micro including Video, Broadcom, Intel, Micron,

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<v Speaker 3>and Western Digital, and it is a big name.

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<v Speaker 2>You know.

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<v Speaker 3>According to the Bloomberg Terminal, more than fifty percent of

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<v Speaker 3>what SMCI spends goes to in video. But a lot

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<v Speaker 3>of people spend a lot of money within video.

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<v Speaker 1>Yeah no, yeah, those are big numbers all around me.

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<v Speaker 3>It's not just super Micro, I.

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<v Speaker 1>Guess TBD right, Like we're going to find out what

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<v Speaker 1>happens with this one, all right, where shall we go next.

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<v Speaker 4>Yeah, so let's go to Dell. So this is kind

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<v Speaker 4>of the flip side of the server. Mark your trade.

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<v Speaker 4>So we're seeing this up about a little hundred three

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<v Speaker 4>percent right now. This is ticker d E l L.

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<v Speaker 4>So basically what it looks like is if SMCI is,

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<v Speaker 4>you know, having these issues, Dell could really get more

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<v Speaker 4>share here in this space. So a couple of analysts

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<v Speaker 4>and some investors I've spoken to saying that this really

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<v Speaker 4>could be a beneficiary because it's a competitor of SMC,

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<v Speaker 4>I have super micro.

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<v Speaker 3>All right, Dell moving in the opposite direction as SMCI.

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<v Speaker 1>Talks up of nearly thirty percent Dell this year, Like, woa.

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<v Speaker 3>Dude, you're getting a Dell remember that we remember that. Yeah,

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<v Speaker 3>very different company than it was.

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<v Speaker 1>Which is just the you know, definitely transformed.

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<v Speaker 3>Let's stay in the industry and talk Micron.

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<v Speaker 4>Yeah, so ticker MU. Micron has been an interesting one

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<v Speaker 4>this week. So share their down about five point three

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<v Speaker 4>percent today is a two day decline. I think this

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<v Speaker 4>is interesting because the company had really blow out earnings

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<v Speaker 4>on Wednesday after hours, really great you know, forward guidance

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<v Speaker 4>seems like everything's good, but it seems like investors are

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<v Speaker 4>really focusing on this higher capital spending that they're saying,

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<v Speaker 4>you know that they need to continue what's.

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<v Speaker 3>A few billion dollars here and there, right, and lets

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<v Speaker 3>want to see twenty two points something billion, and they

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<v Speaker 3>got twenty five billion.

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<v Speaker 4>Well, and it's all you know, it's all for the

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<v Speaker 4>AI trade. It's building out data centers. You know, it's

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<v Speaker 4>something that Micron needs to do to fulfill you know,

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<v Speaker 4>all the demand that they have in the memory space.

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<v Speaker 4>So it's interesting, I mean also to note that the

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<v Speaker 4>stock could run up, you know, fourteen percent, and three

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<v Speaker 4>days before results it was up sixty percent this year,

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<v Speaker 4>you know, ahead of those as well. So a lot

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<v Speaker 4>of buying, a lot of enthusiasm here a.

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<v Speaker 1>Double edged sword, right, Like, it's great to have all

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<v Speaker 1>that demand, but they can't they don't have enough supply

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<v Speaker 1>to meet it, and so they've got to do the buildout,

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<v Speaker 1>which costs a lot of money and sometimes more than

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<v Speaker 1>what they anticipated. And this gets to the story that

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<v Speaker 1>we constantly talk about these cycles where the demand is

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<v Speaker 1>outstripping the supply, and this is kind of I feel

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<v Speaker 1>like exponentially the demand is outstripping the supply and then

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<v Speaker 1>they've got to spend, and then you wonder, by the

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<v Speaker 1>time they build it, is that demand still there. I

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<v Speaker 1>don't know.

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<v Speaker 4>Yeah, it's definitely something that we're looking at in the

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<v Speaker 4>entire memory space. Right Like, these stocks have done so

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<v Speaker 4>incredibly well, people are definitely still excited about them as

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<v Speaker 4>part of the AI infrastructure trade. But it is a

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<v Speaker 4>very cyclical sector, so we're definitely looking at that as well.

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