CIMG Inc. (IMG) shares jumped Friday after the holding company announced it locked down $124 million worth of computing power contracts during the fourth quarter. Before you get too excited, though, there's a catch—the revenue isn't actually guaranteed yet.
The Details Behind the Deals
Here's how this works: CIMG committed to $124 million in contracts and framework agreements, but several are still in play. One of the company's Beijing subsidiaries made the shortlist for a Bank of Guangzhou contract with a benchmark bid of roughly $15.95 million, though they might not ultimately win it.
The more interesting piece involves at least two computing power projects. These deals will include selling and delivering computing hardware—think computing servers and GPUs manufactured by third-party suppliers including NVIDIA. This is the infrastructure that powers artificial intelligence applications, which explains why CIMG is betting big here.
"Our move into the computing power industry is not about chasing short-term trends but is based on a deep understanding of the industry's future, viewing it as a cornerstone for the company's long-term development," said Wenlong Tong, who recently stepped into the president role.