Inspur Sees Weak Cloud Revenue, Stock Plunges
The company posted a 40.60% revenue growth in 1H 2020 despite temporary chip supply suspension.
Server brand company Inspur Electronic Information Industry (000977:SZ) has revealed its 3Q results for 2020. The first- three-quarter revenue jumped by 19.02% to CNY 45.50 billion, accompanied by CNY 628.30 million net profit attributable to the parent company. For the third quarter, the company generated CNY 15.22 billion topline, decreasing by 8.82%. Profit for the period dived 8.91% year-on-year to CNY 223.65 million.
The stock price glided by 9.34%, closing at CNY 27.65 per share on Monday. In contrast, the SSE Composite index and SZSE Component index rose 0.02% and 1.39% respectively.
Inspur claimed the performance was due to weak demand from large cloud service providers. The revenue base for 3Q of 2019 is the second-highest in its history, which partially intensified the decline.
Founded in 1998, the company is a state-owned enterprise controlled by Shandong Provincial SASAC, primarily providing X86 servers and related components to Chinese clients.
According to International Data Corporation, in the second quarter of 2020, the worldwide server market revenue topped at 19.8% annually. Inspur grasped 10.5% of the global market, up from 7.1% a year ago.