DK Street Journal

The wiring inside an artificial-intelligence data center is being rebuilt. NVIDIA, working with Google and Microsoft through the Open Compute Project, is moving racks to distribution at 800 volts of direct current (800VDC) instead of the 54 volts used today — a change it says cuts copper use by up to 45%, with platforms in production and rolling out in the second half of 2026 behind more than 80 supplier firms. Six small American makers of the chips, modules, magnetics and switches in that power path have been swept up in the story. Only one of them has an order book that has already moved.

The company whose numbers arrived early

Vicor, an Andover, Massachusetts maker of brick-format DC-DC converter modules sold to equipment manufacturers, reported on 21 July. Its one-year backlog rose 26% sequentially to $379.7m, and was up 145% against the year before, with book-to-bill above 1.0. Advanced products — the newer, higher-density lines — jumped 45% sequentially to $94.2m and now make up 65.7% of revenue. Gross margin widened 280 basis points sequentially to 58.0%. Management guided full-year 2026 revenue above $600m and lifted its long-term target from $1bn of revenue at 65% gross margin to $2.5bn at 70%.

The headline growth rate hides all of that: revenue rose only 1.6% year-on-year, because the comparable quarter contained a $45m one-time patent settlement. The shares fell 7% on the day and have kept falling. Vicor touched an all-time high of $382.65 on 30 June, according to market data, and closed at $254.27 on Monday.

So the multiple has compressed while the order book expanded. This desk's own May record had Vicor at 61.8x trailing gross profit and 105x trailing earnings on a $14.4bn market value. It now trades at 42.9x trailing and 33.7x forward gross profit, 79.7x trailing earnings, on $11.5bn. The cautions are real: Vicor lost the NVIDIA H100 socket to Monolithic Power and holds Google's tensor-processor sockets instead; volume ramps for its second-generation vertical power delivery are guided to late in the fourth quarter of 2027; and its first chip fab is nearing capacity, with a second plant still at site selection. It is capacity-constrained before it is demand-constrained.

The rest of the group is bouncing, not advancing

The group's 19% month looks less like a trend on inspection. Late July saw chip stocks lose more than $1trn of market value on doubts about AI returns, which set the low base. Strip each stock's two best single sessions from the 30-day window and the group's average return goes to about -3.3%, with only Ultralife and Navitas still positive. Over three months the average gain is 3.9%.

Navitas, a Torrance, California designer of gallium nitride (GaN) and silicon carbide power chips, is the only member named in NVIDIA's 800VDC silicon supplier list. Its revenue fell 27.3% year-on-year to $10.5m, a fourth straight quarter of double-digit decline, and it posted a gross loss on a reported basis. Management expects AI infrastructure plus grid to exceed one-third of sales by year-end — roughly $4m to $5m a quarter — with rack-level GaN content arriving in 2027. The stock trades at 81x forward sales and about a third below the $21.89 at which it raised $373m in the spring.

Bel Fuse, the Jersey City maker of magnetics, connectors and the hot-pluggable power shelves that feed a rack, is the coherent grower: revenue up 25.2% to $210.7m, operating income up 47.4%, six consecutive quarters of positive book-to-bill. Its biggest growth contributor was defense at $66.5m, larger in dollars than its roughly $58m data-solutions line. The B shares trade at 31.5x forward earnings against 75x trailing — and consensus has revenue growth slowing to 8.0% next year.

Ultralife, which makes battery packs and radio accessories in Newark, New York, rose 19.4% in one session after reporting revenue down 1.3% to $47.9m; its record $117.5m backlog is Army communications work, and part of its margin gain came from a $1.1m tariff refund. It is the cheapest name here, at 0.54x forward sales. Ideal Power, a 17-employee Austin licensor of a bidirectional solid-state switch, booked $5,800 of revenue last quarter; it says it will ship breaker prototypes for 800-volt data-center testing with low-volume orders hoped for in the fourth quarter, against a $400m claimed pipeline.

Four of the six were in downtrends as of 14 August, their 50-day averages below their 200-day; Vicor crossed below on 12 August, mid-bounce.

The setup

Where it stands — Vicor's backlog and margins are accelerating while its multiple contracts; the other five have little shipped 800VDC revenue. Would confirm — Vicor's one-year backlog holds above $379.7m in the third quarter with book-to-bill over 1.0. Would invalidate — Full-year revenue guidance falling back below $600m, or advanced products slipping under 60% of sales. Watch next — Vicor's third-quarter report in late October; Navitas guided to $13.5m of revenue for the same quarter. Valuation — Vicor at 42.9x trailing and 33.7x forward gross profit, against 61.8x trailing in mid-May.

HP Inc. — which sells desktop and laptop PCs, workstations and point-of-sale systems, plus printers and the high-margin ink-and-toner annuity behind them — is shipping more computers than it has in years and keeping less of the money. Revenue in the quarter ended 30 April reached $14.4bn, up 9% year over year and the fourth consecutive quarter of accelerating growth. Operating income over the same stretch fell 6.4%, to $612m. Operating margin narrowed by roughly a percentage point from the prior quarter, to 4.25%.

That gap is the whole story. The volume is real: Personal Systems revenue rose 13% to $10.2bn, with commercial units up 14% and consumer units up 10%, and machines marketed as AI PCs reached 44% of shipments. Microsoft stopped supporting Windows 10 in October 2025, and corporate buyers have been replacing fleets since. Gross margin actually recovered 130 basis points sequentially, to 20.93%.

The chips are eating the refresh

What sits between that gross margin and the operating line is cost. Memory is now the single largest swing factor in a PC's bill of materials. HP told investors it had held costs down by reconfiguring products, qualifying cheaper components and drawing on older inventory, while repricing to pass through commodity increases — and that input costs would keep rising in the back half of the year. Management expects Personal Systems margin to stay below its long-term range for the rest of fiscal 2026, with the fourth quarter the low point.

The supplier side agrees. TrendForce expects conventional DRAM contract prices to rise another 13-18% in the third quarter and NAND flash 10-15%, after jumps of roughly 60% in the second — tightness driven by AI accelerators and server memory competing for the same wafers, not by anything a PC maker can influence. The pass-through is now visible in demand: IDC forecasts global PC shipments falling 11.3% this year, with fourth-quarter declines possibly reaching 20% and no relief expected before the end of 2027. The refresh has runway, but increasingly at the small-business end, where HP's pricing power is weakest.

Printing is the ballast and nothing more. Revenue was $4.2bn, flat year over year and down 2% in constant currency, at an 18.3% operating margin, with supplies revenue up 1%. The cost programme remains on pace for $1bn of gross annualized savings by the end of fiscal 2028. HP guided to full-year adjusted earnings of $2.90 to $3.10 a share and free cash flow of $2.8bn to $3.0bn.

Cheap against Dell, expensive against itself

HP trades at 10.74x trailing and 9.73x forward earnings, 0.47x sales, and 2.32x trailing gross profit, with a trailing free-cash-flow yield of 14%. Dell Technologies, which builds the AI servers that consume the memory HP is fighting for, trades at 12.77x gross profit on a 2.89% free-cash-flow yield; Hewlett Packard Enterprise, the networking and server business spun out in 2015, at 6.19x and 5.03%. The oddity: Dell's most recent quarterly gross margin was 17.75% — thinner than HP's — on 87.5% revenue growth. Investors are paying roughly five and a half times as much per dollar of Dell's gross profit as for HP's.

Against its own history the reading inverts. Forward earnings multiple near 9.7x is up from about 6.4x in February. Consensus has fiscal 2026 earnings at $3.02 a share, down 2.8%, and fiscal 2027 at $3.02 — no growth. Trailing and forward multiples are nearly identical, which is the market saying the same thing. Seventeen analysts polled by S&P Global carry a Hold with an average target of $22.98, some 22% below where the shares trade, even after raising that target 15.5% in three months.

What the month actually was

From mid-July the shares rose about 25%. Four sessions carry it. Strip the best two and the gain is 8.6%; strip four and the month is −3.0%, with the other seventeen sessions net negative. One of the four was 13 August, when HP, Dell and Super Micro all jumped after Lenovo posted record revenue of $26.94bn, up 43% — a rally on someone else's results. Over twelve months HP is up 10.6%, against Dell's 246% and memory maker Micron's 707%. The profit in this supply chain has moved to the component, not the box.

The setup

Where it stands — HP's volumes are growing and its operating profit is not, with memory costs guided to worsen into the October quarter. Would confirm — Personal Systems operating margin holding at or above 5.2% in the third quarter despite higher DRAM and NAND costs. Would invalidate — Full-year adjusted EPS guidance cut below the $2.90 floor, or free-cash-flow guidance trimmed from $2.8bn. Watch next — Fiscal third-quarter results on 26 August; consensus is $0.66 a share on $14.44bn. Valuation — 10.74x trailing and 9.73x forward earnings, against roughly 6.4x forward in February and a $22.98 average target.

A record quarter with an expiry date

Atlassian, the Australian-founded maker of the Jira issue tracker and Confluence wikis used by more than 350,000 corporate customers, reported June-quarter revenue of $1.77bn, up 27.6% from a year earlier. Adjusted earnings of $1.87 a share beat the $1.50 analysts expected. Operating income came in at $211.7m against a loss of $28.5m a year earlier. Subscription annual recurring revenue reached $6.6bn, up 23%, and contracted revenue not yet recognized rose 44% to $4.8bn.

The same release guided fiscal 2027 revenue growth to roughly 13% — half of fiscal 2026's 26%. The reason is largely accounting. In September 2025 Atlassian set March 2029 as the end of life for Data Center, its self-managed server product, a decision that pulled term-license revenue forward into the year just closed. Data Center revenue is guided to decline about 17% next year. Non-GAAP operating margin is guided down to 25% from 36% in the June quarter, with roughly four points of last year's margin attributable to that revenue timing and a further three points of pressure from a shift toward cash compensation.

The shares rose 35% on 7 August, trading as high as $153.20 intraday. Price-to-gross-profit expanded from 4.83x on 29 July to 7.64x on 14 August, a 58% re-rating in seventeen sessions. Forward earnings multiple is 26.67x; there is no usable trailing figure on a GAAP loss.

One disclosure did travel the other way. Management said seat counts in core Jira and Confluence expanded, and that artificial-intelligence adoption is increasing rather than reducing demand for planning and collaboration seats — a year after Atlassian reported its first-ever enterprise seat decline. That is a direct answer to the argument that AI assistants shrink software headcount licenses.

Three days did most of the work

Atlassian sits in a group of nine software companies that all rose over the nineteen sessions to 14 August, averaging +21.1%. Strip each name's two best sessions and that average becomes -2.9%, with only four of nine still positive. Strip three shared days — 28 July, 7 August and 13 August — and it is -4.5%.

The 28 July session is the tell. The S&P 500 tracking fund fell 0.88% while eight of the nine rose between 6% and 17%. It was a rotation: the semiconductor index dropped 4.8% as ServiceNow gained 4.8% and monday.com 6.1%. Morningstar's US application-software index bounced 15% from 22 July, helped by a July consumer-price reading of +0.1% month-on-month that pared bets on a September rate increase. Workday rose 40.1% over the same thirty days, MongoDB 38.2%, against 2.9% for the index fund.

That breadth kills the neatest available theory. Workday bills per employee seat and led the complex; Datadog, the purest consumption-priced observability vendor in software, fell 3.4%. Inside the nine the split runs the wrong way as well: the accelerators include seat-billed Atlassian and Salesforce, while the decelerators are usage-priced Nutanix, whose growth slipped from 13.5% to 10.0% across three quarters, and Dynatrace, from 19.4% to 16.2%.

Four companies actually accelerated

JFrog, which runs Artifactory — the repository where software teams store and distribute code packages — delivered the cleanest print: revenue up 28.7% to $163.8m, net dollar retention of 121%, and non-GAAP operating margin of 19.9% against 15.2%. It is also the group's worst performer at +5.4%, and the most expensive, at 100.84x forward earnings and 23.64x forward gross profit. Its cloud line, now 53% of revenue and growing 53%, means it is consumption-billed in practice.

Twilio, whose programming interfaces let developers send messages and place calls from inside their own apps, raised fiscal 2026 organic growth guidance to 13-13.5% from 9.5-10.5%, with net expansion at 116% and free cash flow of $353m. Its third-quarter organic guide steps back to 11-12%, and at 12.78x forward gross profit on a 48% gross margin it is the least software-like economics in the group. Its uptrend is the longest here, unbroken since 17 April.

Samsara, which sells dashboard cameras and equipment sensors subscribed per connected vehicle or machine, grew 30.5% and turned an operating profit for the first time, at 1.5% of revenue. It has published nothing since 4 June.

Three re-rated on no new numbers

Veeva, which sells clinical-trial and sales software exclusively to drugmakers, has not reported since 3 June, yet its price-to-gross-profit rose from 13.13x to 15.92x in seventeen sessions. Growth has sat near 16% for five straight quarters and gross margin narrowed 240 basis points. At $243.75 it is level with the $244.14 average analyst target and reports on 26 August.

Nutanix, the per-node hybrid-cloud platform pitched as the alternative to VMware, gained 22% with no earnings since May and announced a 5% workforce cut on 4 August, carrying charges of $33m-$43m. Dynatrace, which monitors application performance across clouds, raised its revenue guidance by only 25 basis points and re-rated least, from 7.76x gross profit to 8.40x. Bill.com, which automates supplier payments for small businesses, grew 13.5% on a 1.1% operating margin and remains the cheapest at 14.78x forward earnings.

The one that never turned

Salesforce is the divergence. Growth has accelerated three quarters running — 8.6%, then 12.1%, then 13.3% — operating margin widened to 21.8% from 19.8%, and net income rose 36.7%. It trades at 13.86x forward earnings against 22.63x trailing, on a 9.12% free-cash-flow yield. It is down 15.9% over twelve months and is the only one of the nine whose 50-day average is still below its 200-day.

The setup

Where it stands — Atlassian's gross-profit multiple is 58% higher than three weeks ago while management guides next year's revenue growth to halve. Would confirm — Subscription annual recurring revenue growth holding near 18% next quarter as Data Center license revenue rolls off. Would invalidate — Fiscal 2027 revenue guidance trimmed below 13%, or cloud revenue growth slipping under 25%. Watch next — Veeva reports 26 August; Atlassian's first fiscal-2027 quarter lands in late October. Valuation — 26.67x forward earnings and 6.85x forward gross profit against 7.64x trailing; no meaningful trailing multiple on a GAAP loss.

The category label says wireless and mobile networks. Only one of the three companies inside it sells equipment to mobile-network operators, and that business is contracting. The other two are, in substance, a defense-radio maker and a drone company that happen to move data over private radio spectrum.

The one that sells to carriers

Ericsson, the Stockholm supplier of radio access network hardware, software and services to mobile operators, reported second-quarter sales of SEK54.3bn, down 1.3% year over year. That is the fourth consecutive quarter of decline. Networks — the largest and highest-margin segment, and the one that would register any capital-spending inflection — fell 8% to about SEK33bn, an organic drop of 4%, with declines across Europe, the Middle East, Africa and the Americas and growth only in Asia.

The industry backdrop agrees. Dell'Oro Group, which tracks telecom equipment shipments, has worldwide RAN revenue growing at roughly a 1% compound annual rate over five years as operators prioritize capital efficiency. Operator spending has not turned.

What has turned is Ericsson's cost of parts. Management guided third-quarter Networks adjusted gross margin down to 48-50% from 50.4% and warned that component cost inflation will build through 2027, with no automatic pass-through in long-term contracts. The cause sits outside telecom: server memory prices could double by the end of 2026 as Samsung, SK Hynix and Micron shift wafer capacity toward high-bandwidth memory for AI accelerators, with data centers expected to absorb 70% of global output. Equipment makers are at the back of that queue.

Ericsson's shares are cheap on delivered numbers — 13.2x trailing earnings, 6.9x EV/EBITDA and a 9.7% free-cash-flow yield. But consensus has 2026 earnings per share at SEK5.46 against SEK8.00 in 2025, a 31% cut, with no revenue growth until 2027. Per Narvinger, the current Networks head, takes over as chief executive on 1 October, replacing Borje Ekholm, who conceded on the July call that the shares had underperformed the Nasdaq-100 by 67% since 2017.

The one that is accelerating

Motorola Solutions sells land mobile radios, video security and command-center software to police, fire and government customers. Revenue of $3.13bn grew 13.3% last quarter, up from 7.4% in the first — acceleration, not the deceleration the sector implies. Gross margin reached 53.6% from 51.1%, and backlog hit a record $15.6bn, up 11%. Full-year guidance went to about $12.975bn of revenue and $17.62-$17.72 of adjusted earnings per share.

The composition matters. Silvus military mesh radios were lifted to $850m for the year on NATO, German, Ukrainian and Indo-Pacific demand; international revenue grew 25% against 9% in North America. The recurring software and services segment grew 10%, slower than the 15% in hardware — the subscription mix is being diluted, not enriched. Motorola also flagged a $150m memory-cost headwind, the same squeeze hitting Ericsson, and agreed to buy counter-drone specialist D-Fend Solutions for $1.5bn.

At 26.7x forward earnings against 36.3x trailing, the stock is below the roughly 30x it carried a year ago on then-forward numbers — the price is 1.1% higher than twelve months ago while consensus earnings moved from $15.16 to $17.49. Still, the guidance raise lifted the earnings midpoint about 4.7% while the shares rose 14.6% in a month; two-thirds of that is investors paying more for the same dollar.

The one that printed shares

Ondas Holdings, a Massachusetts maker of private wireless radios and autonomous drone systems for rail, energy and defense customers, reported revenue of $83.8m against $6.3m a year earlier. Pro forma backlog reached $757m from $68m at end-2025, and full-year guidance went to $525-550m against 2025 revenue of $50.7m.

The funding tells the other half. Diluted shares went from 150.7m to 503.6m in a year, a 234% increase, after a $1bn registered direct offering and a shareholder vote lifting authorized stock to 1.2bn shares. So the 17.6% fall in the share price over three months is not a shrinking company or a cheaper one. Adjusted EBITDA loss widened to $50.6m from $5.8m, with company-wide profitability guided only to late 2027, and consensus models net losses again in 2027 and 2028. Forward price-to-sales is 10.0x on revenue never yet delivered.

The arithmetic

The month decomposes to Ericsson +2.0%, Motorola +14.6% and Ondas +31.1%. Remove each name's two best sessions — Motorola's 7.9% jump the day after earnings, three Ondas sessions near 11.5% — and the group's month falls to about +1.5%, with Ericsson negative. Ericsson's window begins one day after the ADR dropped 13.5% on a Q2 miss; it remains 12% below the pre-earnings price. Over three months the three are down about 6.6% together, and the 57% twelve-month gain is Ondas at +135% against Motorola's +1.1%.

The setup

Where it stands — One month of gains, authored by two earnings sessions and a micro-cap, with carrier spending still falling. Would confirm — Ericsson Networks organic sales returning to growth, or third-quarter adjusted gross margin holding above the guided 48-50%. Would invalidate — Motorola's software and services growth reaccelerating past hardware, restoring recurring mix rather than diluting it. Watch next — Ericsson's third-quarter report in October, Per Narvinger's first as chief executive; Ondas guided to $140-155m of Q3 revenue. Valuation — Motorola 26.7x forward against 36.3x trailing and roughly 30x a year ago; Ericsson 13.2x trailing on earnings guided down 31%.

On 10 August, Nvidia signed memoranda of understanding with six financial firms to build platforms capable of mobilizing more than $500bn of third-party capital for AI computing infrastructure. The signatories were Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs and KKR. The structure exists so that data centers, power and land get funded without adding to Nvidia's own balance sheet, with Goldman — the only bank in the group — expected to lead the associated public debt sales.

The next session, the eleven firms examined here rose 4.2% on average, their best day of the summer. That is most of the story of their month. Three other broad sessions — 28 July, 3 August and 13 August — carried nearly all the rest, and the remaining fifteen trading days averaged roughly flat. Remove each name's two best sessions from the 30 days to 14 August and eight of the eleven go negative: Goldman -16.1%, Morgan Stanley -10.5%, Brookfield Corporation -6.6%, Carlyle -5.6%, Brookfield Infrastructure -4.4%, KKR -2.0%, Blackstone -1.9%, Ares -0.3%. Only Apollo and Brookfield Asset Management stay up. None of the four big sessions was an earnings date for anyone in the group.

Two entirely different years

The twelve-month picture is not flat, it is bimodal. The firms that manage other people's money were mauled: Ares -24.4%, Carlyle -24.1%, KKR -21.9%, Blackstone -17.6%, Brookfield Asset Management -12.6%. The firms that underwrite the debt or own the assets had a fine year: HA Sustainable Infrastructure +57.9%, Morgan Stanley +46.4%, Goldman +39.1%, Brookfield Infrastructure +33.1%. The damage to the first group traces to March 2026, when redemption requests at retail-facing private-credit vehicles turned into a sector-wide panic. Requests at the twelve largest non-traded business development companies averaged 12.1% in the first quarter, well above the 5% level at which managers gate — while non-accruals in those same portfolios ran at 0.6%.

The fee engines accelerated

Blackstone, which invests across real estate, credit, private equity and infrastructure, reported second-quarter fee-related earnings of $1.8bn, up 22%, on record assets under management of $1.35 trillion. Its data-center platform is now worth $185bn, against $130bn in January, and nine of its ten largest quarterly markups were AI-related. Reported revenue rose 28.5% with operating margin at 61.9%, from 51.6% a year earlier.

Apollo, which pairs an origination machine with the Athene retirement balance sheet, produced record fee-related earnings of $785m, up 25%, with fee-generating assets up 34%. It originated $74bn in the quarter, before counting the $35bn facility for Broadcom that it calls the largest private-credit financing ever written. Three-quarters of what it originates is investment grade.

KKR posted record fee-related earnings of $1.32 a share, up 34%, and holds $72bn of committed capital not yet earning fees — an embedded tailwind at roughly 90 basis points. In June it launched Helix, a permanent vehicle with more than $10bn of founding capital from KKR, the Kuwait Investment Authority, Nvidia and Vistra, run by former Amazon Web Services chief Adam Selipsky as a single counterparty for hyperscalers.

Ares, the most credit-heavy of the group, grew fee-related earnings 20% to $491m at a 42.3% margin and raised a record $36bn in the quarter. Its Ada platform is building seven data-center campuses totaling about one gigawatt. Crucially for the March narrative, its non-traded BDC redemption queue fell from about $1.2bn to $600m and non-accruals there sit at 0.5%.

Brookfield Asset Management grew fee-related earnings 20% to $808m and raised $77bn in a single quarter, its best ever. It runs about $85bn of digital infrastructure, launched a $10bn AI fund against a pipeline above $100bn, and says every AI deal is contracted to a named counterparty with no speculative construction. It bought back $575m of its own stock this year on the view that the shares are cheap.

Carlyle, which runs buyouts, credit and the AlpInvest fund-of-funds business, earned a record $472m of distributable earnings and $111m of capital-markets fees, more than double last year. It returned $37bn to investors over twelve months — evidence that exits are not shut.

The banks are the odder case

Goldman Sachs booked record second-quarter revenue of $20.3bn at a 23.5% return on equity, with advisory revenue up 17% and the deal backlog at a five-year high. It fell 9.8% over the month. Morgan Stanley reported record revenue of $21.3bn and investment banking up 58%, and passed Goldman into second place globally with $2.3bn of first-half capital-markets fees against $1.4bn a year earlier, almost all of the increase from AI infrastructure work. It fell 4.9%. The two cheapest names here — Goldman at 14.9x forward earnings against 15.8x trailing, Morgan Stanley at 16.9x against 17.5x — declined into a fee pool that is still growing. Data-center asset-backed issuance has gone from $4bn in 2020 to $61bn so far in 2026.

Among the asset owners, Brookfield Infrastructure — a partnership holding utilities, transport, pipelines and roughly 50 data centers — grew funds from operations 10% a unit, with its data segment up 36%. HA Sustainable Infrastructure, a 170-person specialty lender to renewable and efficiency projects, grew revenue 41% to $120.8m. Brookfield Corporation, the holding company whose main asset is 73% of Brookfield Asset Management, is the one name genuinely in a downtrend, its 50-day average below its 200-day since early August; its first-quarter revenue grew 2.5% and it netted $100.6m on $18.4bn of sales.

What the price already assumes

The managers rallied and remain 12% to 29% under their highs. Their forward multiples sit far below trailing ones — Carlyle 13.7x against 48.7x, Apollo 16.0x against 30.5x, KKR 18.4x against 33.9x, Blackstone 24.3x against 32.0x, Ares 24.5x against 62.9x. That gap is the market underwriting the fee build, not doubting it. Brookfield Asset Management is the exception at 29.5x forward against 31.2x trailing, with the least acceleration embedded.

The cautions come from the managers themselves. KKR said hyperscaler data-center spreads have widened lately and the market is showing indigestion on large deals. Blackstone guided third-quarter realizations to decelerate. Goldman said the build-out "won't be a straight line" and could see recalibrations within 6 to 18 months.

The setup

Where it stands — Fee earnings are compounding at 20%+ across the managers while their shares remain well below last year's highs. Would confirm — Third-quarter fee-related earnings growth holding above 20% at Blackstone, Apollo and Ares. Would invalidate — Direct-lending non-accruals rising above 2%, or BDC redemption queues re-widening toward first-quarter levels. Watch next — Third-quarter results in late October, and Blackstone's guided realization rebound in the fourth quarter. Valuation — Managers at 13.7x-24.5x forward against 30x-63x trailing; Goldman 14.9x forward versus 15.8x trailing.

A drilling rig that has spent a year in a yard does not go back to work for free. Crews have to be rehired and retrained, equipment recertified, and the rig moved and rigged up — and for the first months the contract pays a rate negotiated before any of that was known. Precision Drilling, Canada's largest land contract driller with 227 rigs across Canada, the US and the Middle East, put a number on it last month: seven US reactivations, each carrying $1,500 to $2,000 a day of extra cost. Its US daily operating margin fell to $6,210 from $9,290 three months earlier. Guidance for the current quarter is $7,000 to $8,000, and management is only targeting something approaching $10,000 by year-end.

That is the tension across this group. Contract drillers are paid a day rate per rig per working day against a largely fixed daily cost, so activity and price both showed up in the June quarter — and profit mostly did not.

Activity up, profit down

Helmerich & Payne, which drills for oil and gas producers with its FlexRig fleet and has been the industry's premium-rate operator, averaged 142 rigs in North America in its fiscal third quarter and exited at 147. It achieved roughly $18,700 of direct margin per rig-day, more than $1,000 better than the prior quarter, even while reactivating ten rigs. Yet revenue of $1.035bn was down 0.6% from a year earlier and gross margin fell to 12.0% from 15.1%. The gap is the $1.97bn KCA Deutag acquisition closed in January 2025, which took its Middle East fleet from 12 rigs to 88 and brought lower-margin international work plus the debt that funded it. The company reported a $6.1bn backlog and 95% super-spec utilization, generated $98m of free cash flow, repaid a $400m term loan early and is steering toward about 1x net debt to EBITDA.

Nabors Industries, which runs land and offshore rigs and sells drilling software and rig equipment, is the clearest case of motion without money. Its Lower 48 daily revenue rose $902 to $33,600, but daily margin rose $107, to $13,800. Revenue of $816.9m fell 1.9% year on year and the company lost $29.1m. It raised full-year EBITDA guidance to $920-930m — against capex of $710-730m and adjusted free cash flow of just $20-30m. Nabors also disclosed that Saudi Arabia has 196 land rigs running, 28 short of the early-2024 peak; the international recovery is partial.

Precision set a company record of 61 active Canadian rigs and grew its customer count from 25 to 30, but Canadian daily margins slipped to C$13,300 and net income swung to a $1.2m loss from $16.3m. It also said two or three Northeast US gas customers paused programmes — awkward for the story that data-center power demand is pulling gas rigs back to work. And it carries a Canada Revenue Agency reassessment with maximum exposure of C$155m, about 14% of its market value, with roughly C$40m possibly payable within a year.

The exception

Patterson-UTI Energy, the largest combined US onshore drilling and pressure-pumping company and owner of the Ulterra drill-bit business, is the one that converted. Gross margin reached 22.9% against 2.3% a year earlier on flat revenue of $1.228bn. It averaged 92 rigs and guided to about 100, with drilling gross profit stepping from roughly $114m to about $145m, and says high-quality rigs outside the Permian are essentially sold out. Completions pricing is still down about 30% over three years, which management expects to claw back. BofA raised its rating to buy with a $16 target after a decline this year; the stock trades at $11.37.

One session did the work

All four gained over the past month, averaging about 16%. Strip each name's two best sessions and that average falls to roughly 1%, with Patterson-UTI and Precision turning negative. The same date — 10 August — sits in all four lists, the day crude ran toward $82.40 a barrel on the Strait of Hormuz blockade and an International Energy Agency warning of the widest supply deficit in five years. The other spike was Helmerich & Payne's 6 August earnings. Over three months the group is down about 2%, and only Helmerich & Payne has made a new high.

The drilling data does not corroborate a demand surge either: the Baker Hughes US count was 588 rigs, up one on the week, with gas rigs at 126, below February's 134.

What the prices assume

Helmerich & Payne is the most demanding: 7.65x trailing EV/EBITDA, 1.72x book, and consensus of $1.48 for fiscal 2027 puts it at 29.8x. Its forward price-to-gross-profit of 10.63x sits above the trailing 10.54x — analysts expect gross profit to shrink. Patterson-UTI is 6.39x EV/EBITDA and 1.39x book, but 2027 consensus of $0.25 implies 44.9x. Nabors screens cheapest at 2.30x EV/EBITDA, a function of $1.39bn of equity beneath a large debt load, with only two analysts covering 2027. Precision is the only one below book, at 0.95x, on 12.3x forward earnings and a 7.9% trailing free-cash-flow yield.

The setup

Where it stands — Every driller added rigs and raised day rates last quarter; only Patterson-UTI expanded margin, and one oil session made the month. Would confirm — Precision's US daily margin printing at or above the $7,000-8,000 guided range next quarter. Would invalidate — Baker Hughes gas rigs falling back below 120 while day-rate guidance is trimmed. Watch next — Helmerich & Payne's fiscal fourth-quarter results, due November, against 145-151 North America rigs. Valuation — Helmerich & Payne 7.65x trailing EV/EBITDA and 29.8x fiscal 2027 earnings; Precision 0.95x book, 12.3x forward.

Almost every company that assembles the physical machinery of an artificial-intelligence data center — the racks, the boards, the storage arrays — reported results in the past six weeks. Nearly all of them raised guidance. What happened afterward sorted them not by how well they did, but by whether their name goes on the box.

The cleanest way to see it is what investors pay for each dollar of gross profit a company actually earns, measured against where that same figure sat in mid-May. On that test the brands have been marked up sharply and the contractors marked down — the reverse of what their income statements would suggest.

The brands got more expensive on worse margins

Dell Technologies, which designs and sells servers, storage and PCs directly to enterprises, governments and cloud operators, reported revenue of $43.84bn for the quarter ended 1 May, up 87.5% from a year earlier. Its gross margin fell to 17.75% from 21.12%, a 337-basis-point compression, so gross profit grew far slower than sales. Operating income nearly tripled anyway, on volume. Dell exited the quarter with a record $51.3bn AI backlog after booking $24.4bn of orders, and management lifted its full-year outlook to a $167bn revenue midpoint with $60bn of AI-server revenue.

The repricing has been faster than the profit. Dell now trades at 12.77x trailing gross profit, against 6.99x in May, and at 38.4x trailing and 26.6x forward earnings. As recently as spring it was defensible as the cheapest large-cap way to own the buildout, at 14-17x forward earnings. That argument no longer holds at this price.

NetApp, which sells ONTAP data-management software and all-flash storage arrays to enterprises, is the quiet accelerator. Revenue growth has risen for four straight quarters — 1.2%, 2.8%, 4.4%, then 12.5% in the April quarter — with gross margin held at 70.07%, the highest in the group, and operating margin widening to 27.26% from 20.09%. It reported record full-year all-flash revenue of about $4.2bn and roughly 500 AI-related wins in the quarter. Its price-to-gross-profit has gone from 4.55x to 8.29x. Consensus still models only 9.2% revenue growth this fiscal year, below what NetApp just printed.

Super Micro Computer breaks the pattern in the other direction. The maker of liquid-cooled, rack-scale AI systems grew revenue 93.2% to $11.12bn in the June quarter, with gross margin at 17.47% against 9.45% a year earlier — an 802-basis-point expansion. It guided the current quarter to $14.5-15.5bn against a $11.99bn consensus and the year to $65-72bn against $54.43bn, disclosing $60bn of new orders in a single quarter. It trades at 12.3x forward earnings and 4.49x forward gross profit — the cheapest name here on every lens. Three caveats belong with that: the margin path over the year was 9.31%, 6.30%, 9.95%, then 17.47%, so June is a break rather than a trend; trailing free cash flow is deeply negative at a −27.1% yield as inventory absorbs cash; and consensus earnings for this year, $3.24 a share, still sit below last year's $3.26, which is why its forward multiple is higher than its trailing one.

The contractors beat and got cheaper

Celestica, the Toronto company that builds switches, interconnects and full server racks for hyperscalers rather than under its own brand, grew revenue 62.4% to $4.70bn last quarter with gross margin down just 53 basis points and operating margin up. It raised full-year guidance to $20.5bn of revenue and $11.30 of adjusted earnings per share, and disclosed two 2027 programs with multi-billion-dollar potential: custom racks for OpenAI's accelerator with Broadcom, and a build role on AMD's Helios interconnect. It has still de-rated from 26.26x trailing gross profit in May to 21.29x. The proximate cause is a corporate action, not a stumble: a $3bn stock sale to fund the buildout, priced 5 August at $310, was followed by a 14.8% drop the next session.

Sanmina, which makes circuit boards, backplanes and enclosures for other people's designs, grew revenue 69.7% to $3.46bn with gross margin expanding 160 basis points to 10.49%. Cloud and AI infrastructure is now 62% of its revenue, up 173%. Management guided full-year earnings to roughly double, and the shares slipped anyway as investors weighed the working capital the ramp consumes. It carries the lowest forward multiple of any contractor at 17.4x and the highest free-cash-flow yield in the group at 5.3%.

Flex, a manufacturing and supply-chain provider whose lines include data-center switchgear and power distribution, grew revenue 20.6% with gross margin up 72 basis points, and says roughly 90% of the next three quarters is already booked. Its price-to-gross-profit has fallen from 21.42x to 16.79x.

Jabil is the honest exception on both sides: revenue growth decelerated from 23.1% to 11.8%, and its multiple barely moved. Penguin Solutions, the smallest member at $3.3bn and the only one down over the past month, is the pure memory-inflation case — its Integrated Memory revenue rose 111% on volume and pricing while non-GAAP gross margin fell 3.6 points. Its chief financial officer left on 8 July.

What the month's gain is made of

An equal-weighted basket of the eight is up 12.0% over 30 days. Strip each name's two best sessions and that becomes −8.0%; four of the eight were flat or down before any stripping. Dell's largest single day was a 32.76% gain on 29 May, after earnings. Two months later, on 29 July, every contractor fell together — Penguin 9.2%, Flex 9.1%, Celestica 6.2% — as chip and AI-infrastructure shares lost more than $1trn on fears that capital-spending growth is merely slowing, then all rebounded the next day. Dell's 50-day average has sat above its 200-day since 31 March; Celestica's stepped down in mid-August.

The memory story is real but narrow. Server DRAM contract prices rose 90-95% in the first quarter and NAND 55-60%, and passing that through at no markup inflates revenue while crushing margin — which is exactly what Dell's and Penguin's numbers show. It is not what Celestica's, Sanmina's, Flex's or Jabil's show. Their margins went up.

The setup

Where it stands — The contract builders raised guidance and expanded margins yet trade at lower multiples of gross profit than in May; the brands did the reverse. Would confirm — Celestica delivering third-quarter revenue inside its $5.25-5.55bn guide with gross margin still in the mid-11s. Would invalidate — Contractor gross margins contracting next quarter, or a cut to Sanmina's $11.90-12.20 full-year earnings guide. Watch next — Supermicro's next quarterly report against its own $14.5-15.5bn revenue guide and consensus earnings that still sit below last year. Valuation — Supermicro 10.9x trailing and 12.3x forward earnings; Sanmina 37.0x and 17.4x; Dell 38.4x and 26.6x, against 28.3x trailing in May.

The argument against outsourcing companies fits on a napkin: if a business bills by the human hour, software that does the hour for nothing takes the revenue with it. Five companies built on that model have now reported, and their results sort them by an unexpected variable — not what they do, but how much revenue each employee generates.

Where the deflation is actually showing up

Concentrix runs more customer-service agents than any other listed company: 455,000 employees against $9.83bn of revenue last fiscal year, or about $21,600 a head. That is the purest version of the model, and it is the one visibly breaking. In the quarter to 31 May, revenue rose 1.9% to $2.46bn while gross profit fell 2.9% and operating income dropped 35.7% to $95.4m. On 29 June the company cut its full-year revenue guidance to $9.925–10.025bn and its adjusted earnings forecast to $10.83–11.18 a share, citing an accelerating client shift toward cheaper offshore delivery locations. The shares fell about 23% the next day.

NIQ Global Intelligence does something adjacent — it collects and sells shopper and retail measurement data to consumer brands — with a fifth of the payroll. On 10 August it reported organic revenue growth, excluding currency, accelerating to 5.8%, with adjusted EBITDA up 21.9% to $262m and margin 270 basis points wider at 23.3%. Management credited roughly half that margin gain to AI-led productivity in data operations, engineering and support. Levered free cash flow swung to +$74.1m from -$80.6m a year earlier, and full-year adjusted earnings guidance rose to $1.08–1.12 from $0.95–0.99. The shares gapped 41% on 11 August.

The caveat matters. NIQ's reported revenue of $1.124bn was down 7.8% year over year, it lost $30.5m at the net line, and at $17.45 it trades below the $21 at which Advent International and KKR floated it in July 2025. At 12.1x trailing enterprise value to EBITDA, it has round-tripped to roughly its IPO valuation of 12.3x.

The middle of the group

Genpact, which runs finance, procurement and risk operations for banks, insurers and drugmakers with 141,000 staff, has now grown faster for four straight quarters, reaching 7.1% in the June period. Its Advanced Technology Solutions unit grew 24.1% to $363m on record quarterly bookings, and management expects to sign more than $1bn of agentic contract value this year, about five times the 2025 figure. It also left full-year revenue guidance at "at least 7%" rather than raising it.

ExlService, which handles claims, underwriting and payment-integrity work for insurers and banks, has also accelerated four quarters running, to 15.6% in the second quarter. Its data-and-AI revenue grew 30% and is now 61% of the total, while standalone digital operations shrank 1.5% as work migrated across. But operating income rose only 7.6% against that 15.6% top line, and gross margin narrowed 90 basis points on April salary increases. The transition is winning revenue; it is not yet dropping through.

The one that fell

Innodata supplies annotation and training data to foundation-model developers, and it had the best quarter of the five: revenue up 57.8% to $92.1m, gross margin 630 basis points wider at 46.1%, operating income up 73.8%, full-year growth guidance reaffirmed above 40%. Its largest customer fell to 37% of revenue from 56% as a big technology client scaled to 34% — concentration easing, not worsening. The stock rose 16% intraday on 7 August, closed lower, and is down 29% over three months. Its forward price-to-earnings multiple of 59.1x sits above its 44.7x trailing: analysts expect earnings per share to fall.

What lifted the group

The month's gains were not a steady re-rating. A semiconductor drawdown of roughly $1.3trn in late July pushed money into de-rated services names, taking Accenture up 29% in thirty days — on rotation, not a guidance raise — and Cognizant up 36%, though Cognizant's quarterly bookings fell 6%. Both remain 28% and 15% below year-ago prices. Remove each of the five smaller names' two largest single sessions and the +18.8% thirty-day average becomes about -6.9%, with four of five negative. Remove NIQ alone and it is +8.8%.

On valuation the split holds. Genpact trades at 8.3x forward and 10.0x trailing earnings with a 10.0% free-cash-flow yield, against roughly 15x at each of its last two year-ends. ExlService is at 15.2x forward versus 21.9x trailing. Concentrix is at 0.55x book and 2.2x forward earnings, with a 9% guidance cut behind it.

The setup

Where it stands — Five weeks of gains inside a twelve-month de-rating, driven by one 41% session and a rotation out of chips.

Would confirm — Concentrix holding its cut FY26 guidance of $9.925–10.025bn at its next report, and NIQ margins staying above 23%.

Would invalidate — Genpact or ExlService guiding full-year revenue growth below current levels, or another offshore-mix warning on pricing.

Watch next — Concentrix reports its August-quarter results in late September; NIQ's third quarter follows in November.

Valuation — Genpact 8.3x forward against 10.0x trailing and ~15x at its last two year-ends; Innodata 59.1x forward above 44.7x trailing.

The strangest fact in this month's nuclear rally is who missed it. BWX Technologies, the Lynchburg, Virginia manufacturer that builds reactors for U.S. Navy submarines and components for commercial plants, delivered the best quarter of any profitable company in the group — revenue up 18% year over year to $902m, full-year guidance raised across revenue, earnings and free cash flow, and a backlog of $8.4bn that has grown 40% in a year with orders coming in at 1.7x the rate of billings. The stock fell about 2% over the past 30 days and has gone nowhere in twelve months. Meanwhile uranium miners and pre-revenue reactor startups with far weaker quarters rallied double digits.

Three days did the work

The group's advance looks broad by name: seven of nine stocks rose, led by Centrus Energy up 21.5% and Energy Fuels up 19.2%, with the AI-narrative favorite Oklo actually down 2.9%. But it is narrow by time. Remove each stock's two best sessions and every single member's 30-day return drops to roughly zero or below.

Those best sessions cluster on three dates. On July 30, six of the nine had their single best day after the Nuclear Regulatory Commission (NRC) accepted Holtec International's plan to build four small modular reactors (SMRs) totaling 1.36 gigawatts at the retired Oyster Creek site in New Jersey — a project belonging to none of these companies. The rest came on July 21 and during the August 5–7 earnings week. This is a sector repricing on shared headlines, not investors accumulating individual businesses.

The fuel cycle: real prices, rich multiples

The underlying commodity story checks out. Long-term uranium contract prices reached an 18-year high near $94/lb while spot sits around $86.5/lb — term leading spot is the signature of utilities locking in supply against a structural deficit.

Cameco, the Canadian uranium producer and fuel-services company supplying utilities worldwide, said on its July 31 call that long-term prices are tracking toward $100-plus and that its contracted deliveries average more than 28m lb a year. Its headline quarter looked ugly — net income down 92% — but the comparison is distorted by a one-off Westinghouse payment in the prior year, and production guidance was unchanged. The trouble is the price of admission: 166x trailing earnings and 60x forward, against consensus revenue growth of just 2.8% this year. Buyers are paying now for an earnings ramp consensus puts at $2.64 per share in 2027 rising to $4.10 in 2029.

Centrus Energy, the only U.S.-owned commercial uranium enricher and sole licensed domestic producer of the high-assay fuel (HALEU) advanced reactors need, is the same trade in sharper form. Its backlog surged to $4.5bn stretching to 2040, with definitive HALEU offtakes from X-energy and a letter of intent from Oklo, both carrying prepayments. But the current business is going the other way: second-quarter operating income fell 69%, enrichment volumes dropped 23%, and consensus has this year's earnings down 43%. At 74x forward earnings, the stock's 21.5% month was bought on the 2030s, not the income statement.

Energy Fuels, a U.S. uranium and rare-earth miner, grew revenue nearly sixfold to $25.1m but still lost $33.4m; its 15% post-earnings jump rode a $725m government loan supporting its mine-to-magnet buildout. Uranium Energy Corp, which holds uranium inventory and projects it sells opportunistically, reported zero revenue last quarter, a $52.3m loss, and a share count up 23% in six quarters.

The developers: milestones funded by the printer

The four reactor startups are where the twelve-month damage lives — NuScale Power down 74%, Lightbridge down 48%, Nano Nuclear down 44%, Oklo down 40% — and the numbers say that de-rating was earned. Oklo, the Sam Altman-backed fast-reactor developer, has genuine milestones, including Department of Energy design approval for its Idaho plant, but raised $1.9bn through at-the-market share sales this year and lifted its own spending guidance to as much as $150m of operating cash use plus $500m of plant investment. NuScale, the only SMR firm with NRC design certification, booked $75,000 of revenue last quarter — down from $8.1m — while its long-awaited Tennessee Valley Authority power agreement remains unsigned. Lightbridge, a nuclear-fuel technology developer, and Nano Nuclear, a microreactor startup, are both effectively pre-revenue and both funded by fresh issuance.

The demand story these names trade on is real but distant: hyperscalers have committed roughly 9.8 GW of nuclear capacity across 13 deals, yet only about 1.9 GW is operational, and Carnegie Endowment analysis warns announced timelines exceed what U.S. deployment can deliver.

The odd one out

Which brings it back to BWXT. Its one genuine soft spot is margin: operating margin compressed to about 10% in the first half from 14% a year earlier as it invests in capacity, with recovery guided to 2027. That is a real cost, but it sits beside 20% expected revenue growth and a multiple — 36.5x forward earnings — that is the most reasonable growth-adjusted valuation among the group's profitable members. The market spent a month paying up for uranium optionality and SMR headlines while marking down the one company whose backlog is already contracted.

The setup

Where it stands — The group's 17% month rests on three news dates; BWXT, with the strongest reported quarter, sat it out entirely. Would confirm — BWXT operating margin turns back toward 14% while backlog holds above $8bn, closing the gap between results and the share price. Would invalidate — Long-term uranium prices roll below $90/lb or BWXT's book-to-bill drops under 1x, removing the contracted-demand floor. Watch next — NuScale's Tennessee Valley Authority power-agreement signing and the group's third-quarter reports in early November. Valuation — BWXT at 44.6x trailing / 36.5x forward earnings on 20% growth, versus Cameco at 166x/60x on 2.8% growth.

The distributors and resellers that sit between chipmakers, PC brands and corporate buyers — paid a thin spread on every server, laptop and software license that moves through them — just reported their sharpest growth inflection in years. Two forces are driving it at once: corporations replacing Windows 10 fleets before support fully lapses, and enterprises buying AI-ready servers to run workloads on their own premises. A third force is quieter and less flattering: memory chips have gotten so expensive that the same box now rings up at a much higher price, inflating distributor revenue without moving a single extra unit.

The beat the market sold

Arrow Electronics, the 91-year-old distributor of electronic components and enterprise computing gear, is the cleanest case of the market refusing to pay for good news. Second-quarter revenue rose 31.8% to $10.0bn, operating income nearly doubled as operating margin expanded to 3.8% from 2.5%, and earnings beat consensus by 22.5% — after revenue had fallen 15.7% in fiscal 2024. Management said book-to-bill is above 1 in every region, enterprise-computing backlog is up 75% year over year at an all-time high, and called the cycle the "second inning." The shares fell nearly 10% intraday the next day, closing down 8.4%.

The selloff has a logic. Consensus 2026 earnings of $20.45 a share approach Arrow's 2022 peak-cycle $21.80, so the 10.5x forward multiple (13.6x trailing) is pricing cyclicality, not neglect. Management itself attributed roughly a third of the growth to price inflation, and the quarter carried a $27m charge on underperforming partner contracts plus a terminated partner relationship worth about $700m of revenue. Still, gross margin held at 11.26% versus 11.20% a year ago, and the stock carries an 8.2% trailing free-cash-flow yield.

The one that got paid, and the one priced for perfection

Insight Enterprises, an integrator that bundles hardware, software and cloud services for corporate IT departments, is the name that has already collected its catalyst. Revenue rose 15% to $2.4bn with gross margin up 60 basis points to 21.7% and adjusted earnings per share up 44%, and the company raised full-year guidance to $12.20–$12.70 in adjusted EPS on AI-infrastructure and cloud demand — cloud gross profit grew 39%. Infrastructure hardware surged over 20% as enterprises repatriate AI workloads on-premise, though hardware margin fell 110 basis points on pricing and mix. Management explicitly flagged memory-pricing headwinds on devices in the second half and guided the fourth quarter as the year's slowest for earnings growth. At 13.5x forward earnings (22.5x trailing) with a 9.1% free-cash-flow yield, the stock is not expensive even after a 34% month.

PC Connection, a reseller serving small businesses, enterprises and public-sector buyers, posted record quarterly sales of $854m, up 12.4%, with record operating margin. But its notebook revenue grew 19.5% on just 3% unit growth — almost entirely price inflation — and management quantified customer pull-ins ahead of announced price increases. At 19.4x forward earnings with a 1.7% trailing free-cash-flow yield, after inventory swelled $61.5m in the quarter, it is the fullest-priced of the three by a wide margin.

The inflation inside the revenue

The pass-through question is the hinge. DRAM contract prices jumped 55–60% quarter over quarter in early 2026 on AI-server demand, pushing memory to roughly 35% of a PC's bill of materials from 15–18%. The surge began moderating by the third quarter as consumer buyers hit affordability limits, but PC average selling prices are still expected to rise about 17% in 2026 — a richer but possibly lower-unit market. The volume tailwind is real too: the global PC market grew 7% in the third quarter of 2025 as the Windows 10 deadline approached, and roughly half of PCs still ran Windows 10 with extended support lapsing in October 2026.

On the charts, the past month belongs to one name: Insight is up 34.5% since mid-July, driven by its August 6 guidance raise, while Connection added 6.6% and Arrow just 3.8%. The twelve-month picture inverts that — Arrow is up about 70%, having led the group long before the AI-server story reached the reseller rung. That rotation, not a uniform advance, is the honest shape of the move.

The setup

Where it stands — Growth has inflected hard at all three, but a third of it is price inflation and the market is paying peak-cycle multiples only reluctantly. Would confirm — Arrow's Q3 gross margin holds at or above 11.2% with book-to-bill still over 1 in all regions. Would invalidate — Insight's Q4 adjusted EPS growth turns negative, or any of the three reports gross-margin compression exceeding 50 basis points on memory costs. Watch next — Third-quarter reports in late October–early November 2026, straddling the October end of Windows 10 extended support. Valuation — Arrow at 10.5x forward vs 13.6x trailing, within its historical 8–13x range; Insight 13.5x forward; Connection fullest at 19.4x.