We prefer North Asia for AI hardware theme, China is a stock picker's market: Eastspring Investments

Analyst Nupur Gupta at Eastspring Investments argues the AI narrative concerns are outweighed by fundamentals, citing high Q2 operating margins in cloud-related AI business and strong U.S. earnings. Despite ongoing worries about high capital expenditure, the reported margin strength and earnings resilience suggest improving profitability rather than pure growth hype.

Analysis

Analyst Nupur Gupta at Eastspring Investments argues the AI narrative concerns are outweighed by fundamentals, citing high Q2 operating margins in cloud-related AI business and strong U.S. earnings. Despite ongoing worries about high capital expenditure, the reported margin strength and earnings resilience suggest improving profitability rather than pure growth hype.