Summary of GDS Holdings Ltd Conference Call Company Overview - **Company**: GDS Holdings Ltd - **Industry**: Greater China Telecoms - **Stock Rating**: Overweight - **Price Target**: US$54.00 - **Current Price**: US$35.70 (as of October 31, 2025) - **Market Cap**: Rmb50,238 million Key Financial Metrics - **3Q25E Revenue**: Rmb2,884 million, representing a 10.1% YoY growth - **3Q25E EBITDA**: Rmb1,231 million - **Adjusted EBITDA Margin**: 46.2% for 3Q25E - **2025 Revenue Forecast**: Rmb11,514 million - **2026 Revenue Forecast**: Rmb12,964 million Core Insights - **Revenue and EBITDA Growth**: GDS Holdings is expected to achieve 10-11% YoY growth in revenue and EBITDA for 3Q25E, despite a slight QoQ decline in revenue due to the de-consolidation of mature assets into REITs [1][10] - **Chipset Supply Dynamics**: The focus is on new NV chipset supply for China, with ongoing negotiations affecting Nvidia's shipments. This situation is expected to drive stock performance, as domestic GPU productivity is anticipated to meet future demand [3][4] - **Domestic Market Outlook**: New data center bookings in China have been muted since April 2025, with expectations for limited new orders in 3Q25. However, optimism remains for 2026 due to domestic GPU capacity expansion [4][9] - **DayOne Performance**: DayOne is projected to deliver strong order intake, particularly from global hyperscalers, which is expected to offset domestic market challenges [4][10] Market Positioning - **Valuation Metrics**: GDS China is trading at 10.6x 2025 EV/EBITDA, compared to 22x for its REITs assets, indicating a distressed valuation situation [4] - **Future Order Intake**: The market is forward-looking, with hyperscalers' tenders expected to be a significant driver for future growth. There is an upside risk to the forecast of 900MW bookings by the end of 2025, with expectations for continued growth into 2026 [4][10] Risks and Considerations - **Potential Risks**: Risks include reduced capex from hyperscalers, intensified competition, and potential reversals in interest rate trends in China and the US [12] - **Market Sentiment**: The overall sentiment remains cautious due to ongoing geopolitical tensions and supply chain constraints affecting the semiconductor industry [3][4] Additional Insights - **Analyst Ratings**: GDS Holdings is rated as a top pick within the Greater China Telecoms sector, reflecting a positive outlook despite current challenges [7][66] - **Earnings Impact**: The likely impact on consensus EPS for the next 12 months is expected to remain largely unchanged, with potential upside surprises from DayOne orders [10] This summary encapsulates the key points from the conference call, highlighting GDS Holdings' financial performance, market dynamics, and future outlook.