KUALA LUMPUR (Feb 26): Shares of NationGate Holdings Bhd (KL:NATGATE) fell as much as 12 sen or 11.88% on Thursday, as weaker artificial intelligence (AI) server contributions led to a worse-than-expected fourth quarter.
NationGate "would have recorded a core net loss" in the quarter ended Dec 31, 2025 (4QFY2025) if not because of gains on foreign exchange and financial instruments, Kenanga Research said in a note following Wednesday's results release.
The results "may reflect a relatively high-cost base coupled with lower operating leverage in the absence of meaningful AI server contributions", the research house said.
NationGate shares were down at 89 sen in the early session, before marginally paring losses to close at 89.5 sen, still down 11.39%. The stock, previously seen as a proxy for the AI-led graphics processing unit demand boom, is down by 51.1% over the past year.
NationGate's 4QFY2025 net profit fell over 90% to RM6.37 million from RM64.06 million in 4QFY2024, as revenue tumbled 60% to RM1.2 billion from RM3.03 billion. For the full FY2025, while revenue surged 44.4% to RM7.61 billion from RM5.27 billion in FY2024 on higher data computing revenue, net profit shrank to RM125.06 million from RM160.19 million.
"We expect the data computing segment to remain a key revenue contributor in the current financial year, supported by ongoing CPU (central processing unit) demand, while AI server visibility remains constrained amid geopolitical uncertainties," Kenanga Research said.
"As AI deployments gradually shift from model training towards inferencing applications, infrastructure requirements may increasingly involve general purpose and storage-optimised servers to accommodate higher data movement and retrieval needs, including video, images and other large language model-generated outputs," it added.