r/valueinvesting
After SMCI pulls back, should I continue adding to my position?
Author considers adding to SMCI, highlighting its shift from pure NVIDIA reliance to Intel integration and broader enterprise clients.
- Acts as an amplifier for AI server demand and compute capacity expansion.
- Reducing reliance on a single chip vendor by integrating Intel solutions.
- Expanding to a broader customer base including budget-sensitive and government clients.
I’ve been following SMCI for quite a while, mainly because it is deeply tied to AI server demand, especially the entire ecosystem built around NVIDIA GPUs
I currently still hold a decent position in SMCI. My initial logic was actually quite simple: SMCI is largely an “amplifier” of NVIDIA GPU server demand. As long as AI compute capacity keeps expanding, it can benefit from the surge in server shipments
But recently I’ve started to think it might be extending in another direction. For example, it is now increasing its investment in Intel Xeon CPU solutions, as well as Intel’s AI GPU server solutions. To some extent, this reduces its dependence on a single chip vendor. It also feels like it is moving toward a more “broad-based” customer base, such as more budget-sensitive enterprise clients, government projects, and some customized AI deployments
I’d like to hear everyone’s thoughts