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Advanced Energy Industries (AEIS) Is Up 6.7% After AI Data Center Revenue More Than Doubled YoY

Simply Wall St · 3d ago
  • Advanced Energy Industries recently reported that its Data Center Computing revenue more than doubled year over year and now represents over one-third of total sales, helped by growing AI-related demand and a shift of high-volume manufacturing to a new facility in Thailand.
  • This acceleration in AI-focused power conversion, combined with the Thailand move aimed at improving gross margins, marks a significant shift away from the stagnating legacy segments highlighted in earlier results.
  • We’ll now examine how the surge in AI-focused data center computing revenue could reshape Advanced Energy’s existing investment narrative.

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Advanced Energy Industries Investment Narrative Recap

To own Advanced Energy Industries, you need to believe it can turn its AI-focused data center momentum into a more profitable, less cyclical business while managing heavy exposure to a small group of hyperscale customers. The latest jump in Data Center Computing revenue and the Thailand manufacturing shift directly support the near term catalyst of higher-margin AI power solutions, but they also amplify the key risk that any slowdown or budget reset by those hyperscalers could quickly hit growth.

Among recent announcements, the move of high volume manufacturing to the new Thailand facility looks most relevant here, as it ties directly into efforts to lift gross margins while the data center mix grows. If those margin gains do not materialize as expected, or tariffs and supply chain friction offset the benefits of Thailand, the company could find it harder to justify its current valuation and sustain the enthusiasm around its AI exposure.

Yet beneath the AI excitement, investors should be aware that the company’s reliance on a few hyperscale customers means...

Read the full narrative on Advanced Energy Industries (it's free!)

Advanced Energy Industries' narrative projects $2.1 billion revenue and $348.3 million earnings by 2028. This requires 8.5% yearly revenue growth and about a $262.9 million earnings increase from $85.4 million today.

Uncover how Advanced Energy Industries' forecasts yield a $225.00 fair value, in line with its current price.

Exploring Other Perspectives

AEIS 1-Year Stock Price Chart
AEIS 1-Year Stock Price Chart

Two fair value estimates from the Simply Wall St Community span a wide range, from about US$62 to US$225 per share, showing how far apart individual views can be. You can set those opinions against the growing AI driven data center revenue story, and consider how concentrated hyperscale demand might affect the company’s ability to support current expectations over time.

Explore 2 other fair value estimates on Advanced Energy Industries - why the stock might be worth less than half the current price!

Build Your Own Advanced Energy Industries Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

  • A great starting point for your Advanced Energy Industries research is our analysis highlighting 2 key rewards that could impact your investment decision.
  • Our free Advanced Energy Industries research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Advanced Energy Industries' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.