Monday, October 26, 2026

@ActAccordingly Oct 24 3 clicks

PAA Research on X

@TylerHardt It is the business model. We've done extensive work there. Tons of litigation AGAINST their customers to avoid payment. Exclusions are the "secret sauce " not technology $KNSL

@StableBread Oct 24

Fajasy on X

Can Boost Run $BRUN borrow the $527-686M it needs for H2 2026 without selling stock? CFO Erik Guckel said on the Q2 call that $BRUN is working on new ways to finance the build: “We continue to innovate on financing structures beyond the equipment financing approach used to date and expect to provide additional color and progress on this over the next quarter.” The October 8 prospectus amendment names asset-backed securitizations (bonds backed by its GPUs and customer contracts) and rated parent-level debt as new forms of financing $BRUN expects to access. But I found no new facility, lender, or term sheet in its filings or press releases from August 14 to October 16. Founder and CEO Andrew Karos acknowledged on the Q2 call that there’s “a big gap in the market right now” in financing for customers without investment-grade credit. $BRUN’s named customers are private AI startups without investment-grade ratings, so its contracts are harder to borrow against. For comparison, $NBIS’s first secured loan on July 17, $775M at 2.50 points over SOFR (a short-term benchmark rate), was backed by GPUs running under a contract with an investment-grade customer. Thinking Machines Lab, the AI startup founded by former OpenAI CTO Mira Murati, alone accounts for $157.2M/year, 52.3% of what $BRUN’s disclosed contracts should bring in by year-end, and was still in talks to raise $5-6B as of early September. I found no announcement that it closed the round through October 16, so lenders financing its GPUs are also betting that the round closes. Karos also mentioned $NVDA’s AI Compute Partnership (AICP), a program NVIDIA launched in July to backstop GPU clouds’ clusters with its investment-grade credit, for a share of their revenue. However, NVIDIA paused some of its AICP deals over antitrust concerns, the Wall Street Journal reported on August 27. NVIDIA said the program is still in place, but The Information, a tech news site, reported on October 5 that NVIDIA is rethinking its revenue-sharing deals with GPU clouds. Still, lessors funded 79.5% of the H1 2026 build for GPUs already rented out on contracts worth ~1.4x their cost, so I believe $BRUN most likely borrows the $527-686M without selling stock. The Q3 report (mid-November) will show how much $BRUN leased in Q3. If lessors funded 70% of the H2 2026 build instead of 79.5%, $BRUN would need $199-259M of its own cash for the build, more than its $191.8M of pro forma cash. Covering the ~$7-67M gap and keeping three months of the ~$221M of 2027 payments in cash would take a $62-122M stock sale. At $8.89/share, the sale would mean 7.0-13.8M new shares, 8.4-16.4% of the 83.8M outstanding. So the stock at $8.89 depends less on demand or the book $BRUN has signed than on whether it can finance the next ~$1B of GPUs without selling shares at beaten-down prices.

@stockgutter Oct 24 7 clicks

SG on X

An article worth reading in today's @barrons: "Defensive Plays Are Gaining Steam. 5 Heavily Shorted Names Could Pop" $FLO $SAM $FRPT $SFM $VITL https://t.co/pcUzNKB379

@ACapitalLP Oct 24 3 clicks

A Capital on X

I think one of the best uses of time right now, as we wait for the midterms and geopolitical noise to clear, is to really dig into these Powered Shell Providers. $APLD $CIFR $WULF $CORZ $HUT The market is treating them as one homogeneous AI infrastructure trade when the underlying business models, capital structures, counterparty risks and economics are wildly different. Given how badly some of these names have been decimated, I’m not sure how they aren’t either zeros or five-baggers from here. The definition of an asymmetric trade.

@aleabitoreddit Oct 24

Serenity on X

I think it's always helpful to learn what's going on in the supply chain, even if you're not an investor in lasers or $SIVE. There's a lot of dynamics + game theory that goes on in supply shortages like: - Expanding supplier # during shortages -> more opportunities for others. - or as seen with $LITE sold out into 2027 -> causes other hyperscalers to sign LTAs -> capacity sold out into 2029 -> hyperscalers approach $MTSI / $AAOI + others for their own ramps or different opportunities from supply procurement info like $JBL 1.6T LRO program scaling up in H2 2027 from upstream disclosures.

@aleabitoreddit Oct 24

Serenity on X

I'll let this revenue projection graph I made for $AAOI do the talking. Price at $70 I find genuinely riduclous if they deliver on their projections. Rate hikes/macro trims a lot of forward valuations. But the selloff way overshot, which I'd argue is amplified by hedge fund risk/forced deleveraging before month end reporting. Rather than something individually wrong with the company.

@aleabitoreddit Oct 24

Serenity on X

Yes, I like $SIVE. It's a fun company to cover, since there's a lot of supply chain alpha here. But the company completely Tall Poppy Syndromed itself last earnings. And it's clearly shown in the drawdown. Bit of a longer consolidated thought and some scattered bits of supply chain info: - Sivers has 100M CW DFB laser capacity coming online Q4 2027 during an industry shortage. And very large allocations from foundries online (they were doing these quals with Win Semi + 2 others back in 2023/2024), so they can actively monetize the bottleneck today. The other interesting reason why bottlenecks are important (aside from ASP hikes), is because qualifications convert much faster + more likely given incentives around supply scarcity. -> As one example, module makers have expanded the amount of suppliers, eg. (lightcounting cited companies expanding to 5-7+ suppliers from 2-3). Innolight, for example last month responded to a question addressing tight 1.6T DFB laser supply in 2026–2027: - Innolight was actively introducing new suppliers last month and are planning to sign 2-3 year-long contracts to lock upstream capacity -> This is while your biggest merchant laser companies making up the world's 600m+ EML/CW laser capacity like $COHR have redirected lasers to their own programs. $LITE sold out into 2029, Landmark also locked a lot of their capacity into 2027-2029. $AAOI was an expected player, but ended up redirecting lasers into their own transceiver programs too. And this coincides with times $SIVE has tremendous capacity available now + actively engaged with Chinese pluggables players (not saying it's Innolight, but just shows Chinese makers like Cambridge/Eoptolink are actively trying to secure laser capacity). - Fun to note, before $JBL was announced, Sivers had and has ongoing direct engagements with hyperscalers as well. We saw that hyperscalers approached $MTSI and $AAOI for laser capacity from their earnings transcripts (and hilariously got turned away from AAOI due to shortages). So the odds pluggable makers or hyperscalers end up converting to capacity agreements with $SIVE seems a materially higher. Just a little rant: for all the sellside/retail trying to model revenue, you can't just slap on a stupid 25-35% CAGR on NRE revenue since it's close to 0 revenue now. Especially when they scale up to maybe 300M laser capacity (extrapolated from 2:1 external/internal capacity). It's also not the same as $POET having OE packaging capacity at scale, since lasers are in a genuine shortage. So capacity is more likely to convert like how $AAOI is sold out, $LITE is sold out into 2029 We've already seen what revenue that laser capacity brings in since $LITE cited $5B in laser capacity from just one 2028 fab alone in Greensboro (on higher end ranges). And whatever lasers Sivers sell, they're targeting ~50-60+ blended gross margins long term on maybe $3-6 for lower range lasers to $6-$12 for high end custom deployments. But no disclosures around capacity -> revenue conversion yet from Sivers. Now here's the thing people don't really understand, "why no revenue?" for current opportunities? $SIVE pre 2024 focused on custom development for future architectural shifts like CPO. For custom deployments: - We finally got conversion from 1 of their 4 or so lidar customers this week with ~ $AEVA. - ~ $APPL was confirmed ongoing earlier this year with an explanation that "It takes tremendous amount of trials and algorithms way beyond just what we supply to them". - All their customers from 2023-2024 like Ayar and 3 others, probably achieve volume in 2028 as CPO takes off. Custom high end lasers programs are extremely sticky but take many years and are mainly NRE. And as seen with CPO scale up, faced delays with commercialization over the years. So $SIVE from the CEO shift in 2024 realized "okay" let's ramp revenue with mass commercialization products today like 70mW/100mW/200mW lasers for 800g/1.6T pluggables. And that's where they found $JBL and all your other large pluggable players today during the shortage. Now... the work Sivers did in 2023-2024 earlier: Such as $AAPL, Ayar, $AEVA, other lidar/CPO players. And their new mass commercialization opportunities like $JBL, $GFS, and many pluggables/NPO suppliers in engagement now. Have all their inflection points converges 2027 onward, which is why I find the company compelling. Where I think management went completely wrong was messaging and near-term execution: - Deciding to focus on current tiny contracts like Seminex, AllSpace, Tachyon orders felt like the entire focus recently in earnings, shareholder letters, and media commentary -> Brutal honesty to $SIVE management, majority of Western audiences literally don't care and it's immaterial to the valuation. $SIVE moved 0% on all of the Seminex/AllSpace/Tachyon order announcements, and even dropped in price. But rallied like 50% on $GFS and something similar on $JBL announcement. The reason why most took long positions in the first place was CPO. So if $SIVE wants to go answer questions to Swedish media about "Why are you bleeding out" and defending that with cellular orders explaining pipeline conversion. That's not going to help people stay long during drawdowns. -> Second part was not committing to NASDAQ listing in a certain timeframe and actually executing. - If there's delays, sure, just say it, but non-committal lawyer-like language is infuriating to hear, especially from the CFO. I think they'll have that opportunity next month earnings to correct everything. So wrapping up: - There's nothing I see remotely close to $SIVE, in terms of % of global CW laser capacity they're coming online with relative to MC. - They have a ton commercialization paths, from O-Net, $POET, $JBL, Ayar, $GFS, $AAPL, $AEVA, and many potential hyperscaler/pluggable engagements. Even if one or two fall through, the breadth of ongoing quals is so deep + current laser bottleneck is severe, that it's more likely than not many will convert to production. It's clear $SIVE wants to focus on dominating the laser chokepoint first, and ended up using their 700m SEK fundraise for capacity expansion. But they should focus on communicating the billions in potential economic scale from that laser capacity conversion. And execute on it.

@StableBread Oct 23

Fajasy on X

Some notes on this post: 1) Not all of the $99.9M paid down lease debt. $BRUN's finance lease liabilities rose $207.7M on $268.3M of new finance leases, so the payments cut finance lease debt by only $60.6M. Most of the other $39.3M went to advance payments to secure new GPU leases ($37.5M in H1 2026, per the 10-Q's lease note), and the $39.7M of investing outflows paid for equipment and lease prepayments. So more than half of the $139.6M subtracted from operating cash flow was growth investment, while $BRUN added $337.3M of new GPU equipment in H1 2026. 2) The Cohere contract is also set up to be financed against. Cohere "acknowledges that Boost Run finances the equipment, facilities and working capital required to deliver the Services in part against this Agreement." $BRUN can assign its right to receive Cohere's fees to a financing party, and Cohere's obligation to pay undisputed fees is "absolute and unconditional." So $BRUN can borrow against Cohere's payments to pay for the racks, rather than funding them only from its own cash. 3) The material weaknesses behind the controls amendment weren't new. The amended Q1 10-Q says all three were "previously disclosed," including in $BRUN's S-4 (the merger filing). So the amendment corrected the original Q1 10-Q's "effective" conclusion to match weaknesses $BRUN had disclosed before the merger. 4) The CFO award's size dates to the merger, before the controls amendment. CFO Erik Guckel's May 8, 2026 employment agreement, signed when the merger closed, made him eligible for a one-time award covering 2,890,761 shares (time-based RSUs, performance-based RSUs, and options). The compensation committee's September 29, 2026 grant is 2,890,000 time-based RSUs.