(Bloomberg) — The shares of AI-related companies rallied in after-hours trading on Tuesday after strong preliminary results from server-maker Super Micro Computer Inc. spurred relief about the outlook for spending on the technology.
Dell Technologies Inc. and Hewlett Packard Enterprise Co., which both compete with Super Micro in providing computing equipment, jumped more than 5%, while so-called neocloud companies CoreWeave Inc. and Nebius Group rose more than 4%. The VanEck Semiconductor ETF gained 2.2%, and the Invesco QQQ Trust, an ETF that tracks the Nasdaq 100, rose as much as 0.9%.
The artificial intelligence trade has been under pressure this month amid concerns that break-neck spending on computing infrastructure is unsustainable. The Philadelphia Stock Exchange Semiconductor Index has fallen 11% in October, putting it on pace for its worst month since July.
The selloff has hit companies like CoreWeave that rent computing capacity to AI companies particularly hard. Shares of CoreWeave, which is funding its infrastructure buildout by issuing bonds, had fallen 29% this month through Tuesday’s close.
Climbing Treasury yields this year have raised costs for debt financing, which is increasingly being used to support AI spending.
Super Micro said sales will be $18.5 billion to $19.5 billion in the quarter that ended on Sept. 30. The average of analyst estimates called for revenue of about $15 billion, according to data compiled by Bloomberg.
Also lifting sentiment were results from Elon Musk’s SpaceX, which beat quarterly revenue and profit estimates, driven by growth in its AI and satellite internet businesses.
Super Micro shares rose as much as 15% in postmarket trading while SpaceX gained 5.6%.
More stories like this are available on bloomberg.com
