① Wave Information Net revenue and profit for the first three quarters all declined compared to the same period last year, but Q3 improved markedly month-on-month in a single quarter. ② Inventory, capital requirements, and advance payments all increased in the first three quarters, which may mean that the Q3 chip and order situation improved this year.
Financial News Agency, October 31 (Reporter Fu Jing)Due to factors such as the tight supply of GPUs and related specialty chips around the world, Wave Information (000977.SZ)'s performance has continued to be under pressure since this year. Judging from the three-quarter report disclosed after the market today, the company's net revenue and profit for the first three quarters all declined compared to the same period last year, but the Q3 quarter improved markedly month-on-month.
According to financial data, in the first three quarters, the company achieved revenue of 48.096 billion yuan, a year-on-year decrease of 8.85%; net profit of 787 million yuan, a year-on-year decrease of 49.12%. Among them, in Q3, the company achieved revenue of 23.299 billion yuan, an increase of 30.04% over the previous year, and realized net profit of 461 million yuan, a year-on-year decrease of 22.06%.
In fact, this year's Q2 is the first time since Q1 in 2013 that Wave Information has experienced a loss of non-net profit in a single quarter. On a month-on-month basis, Q3's performance improved markedly, and net revenue and profit increased month-on-month.
Since this year, even with a sharp decline in net revenue and profit, Wave Information's inventory has continued to grow. As of the end of September, the inventory was 21.101 billion yuan, an increase of 40.44% over the beginning of the year. The company said, “This is mainly due to an increase in operating inventory.”
At the same time, the reporter noticed that in the first three quarters, Wave Information and other current liabilities increased by 950.02% compared to the beginning of the year, and long-term loans increased by 161.72% compared to the beginning of the year. The company said this was due to “increased capital requirements in the first three quarters.” At the same time, its contract liabilities increased by 62.01% compared to the beginning of the year, mainly due to an increase in advance payment.
Going back to its semi-annual report, the server and components business, which accounted for 98.8% of overall revenue, had revenue of 24.499 billion yuan in the first half of the year, down 29.03% from the previous year. Prior to that, the wave of information had warned investors that the company's performance was affected by factors such as changes in the pace of demand from general server customers and tight global supply of GPUs and related special chips.
In the current three-quarter report, Wave Information did not reveal relevant business progress in detail. Whether the above indicators mean that Wave Information's Q3 chip and order conditions have improved this year remains to be seen. This afternoon, the reporter telephoned its securities department to inquire about the chip situation. The relevant personnel did not respond positively.
It is worth noting that in its semi-annual report, Wave Information clearly mentioned supply chain risks: Currently, raw materials for the domestic server industry are mainly imported. Although the current supply is relatively stable, in the current context of intensifying international trade friction and increasingly complex geopolitics, China's server manufacturers will face core component supply risks. The main raw materials of the company's servers include CPUs, GPUs, hard drives, memory, etc., and the concentration of suppliers is high.
According to information, in terms of chips, Intel and Nvidia were their first and second largest suppliers in 2019. The names of suppliers have not been disclosed in detail since 2020, but Nvidia is still one of its important suppliers.
Recently, chip exports, including Nvidia A800 and H800, have been restricted, and many manufacturers have already stocked up in advance. A buyer from a downstream customer of Inspur Information also told the Finance Association reporter that Inspur notified its company of relevant information in advance. “If you need to order related products, you should hurry up.” The reporter sought evidence from Wave Information on this matter. Interviewees said they were unaware. However, the company said that production and operation are currently normal, and the chip side is also actively preparing supplies.
According to information, Inspur Information released a new generation of G7 computing power platforms this year, covering 16 products for application scenarios such as artificial intelligence. The NF5688G7, an AI training server with a latest-generation integrated architecture, has improved the measured performance by nearly 7 times compared to the large model of the previous platform. At the same time, the NF5688G7, a new generation AI server for the generative AI field, was released in collaboration with Intel. A source from Wave Information also responded: “Overall, the company's AI server's overall business share is rising.”
Meanwhile, a reporter from the Financial Association News Agency learned in an earlier interview with industry insiders that the Wave servers are mainly traditional CPU servers. This part of the market is already weak and facing challenges due to the influence of AI servers.