SMCI’s Rally Shows Momentum Is Back — but $40 Is Less Important Than the Next Margin Report

Eli Lilly's October 29 earnings report presents an unusual test: revenue could decline from the second quarter even while more patients use its medicines. The apparent contradiction comes from pricing, product mix and temporary benefits that lifted the previous period.

Lilly reported second-quarter revenue of $22.97 billion, up 48% from a year earlier. Worldwide volume increased 60%, but realized prices fell 13%. In the United States, volume rose 37% and reported prices declined 3%. Lilly said U.S. prices would have fallen about 9% without favorable adjustments to rebate and discount estimates.

Outside the United States, the contrast was sharper. Volume grew 113%, while realized prices declined 36%, mainly because Mounjaro was added to China's National Reimbursement Drug List. Wider reimbursement can expand access and prescriptions while lowering the amount Lilly receives per unit. That is why patient growth and revenue growth should not be treated as interchangeable.

The second quarter also included a $250 million sales-based milestone tied to Jardiance. That payment raised revenue without creating a recurring quarterly baseline. Consensus data cited by TIKR put third-quarter revenue near $22.6 billion, slightly below the second quarter but about 28% above the year-earlier period. The comparison therefore asks whether underlying volume can offset the missing milestone and continued pricing pressure.

The quarter is the first full period under Medicare's GLP-1 Bridge program, which began July 1. Eligible Medicare Part D patients can access Foundayo or Zepbound for weight management with a $50 monthly copay, subject to clinical and program requirements. The program can expand treated volume, but its effect on Lilly's revenue depends on product mix, negotiated economics and how quickly eligible patients begin therapy.

Profit comparisons require similar care. Second-quarter adjusted earnings were $8.38 per share, but Lilly recorded $2.8 billion of acquired in-process research and development charges. Three additional acquisitions closed after the quarter, creating uncertainty around third-quarter deal-related expenses. Reported and adjusted measures should be evaluated separately rather than combined into one earnings trend.

Investors should begin with three disclosures: volume growth, realized-price change and sales by Mounjaro, Zepbound and Foundayo. Gross margin will show whether manufacturing efficiency and mix can offset lower pricing. Guidance will then reveal whether management expects the access-driven volume increase to remain strong into 2027.

A sequential revenue decline would not by itself prove weaker demand. If prescription volume continues to rise while one-time revenue disappears and net prices fall, the quarter may instead show the cost of broadening access. The more important risk is that price erosion persists after volume growth begins to slow.

Vista Energy's third-quarter report on October 28 will test whether a favorable mix of higher production and stronger oil prices became durable free cash flow. This is the first full quarter to include the interests acquired from Equinor in the Bandurria Sur and Bajo del Toro blocks, making the result a cleaner measure of the enlarged business.

The second quarter established a demanding comparison. Vista produced 156,061 barrels of oil equivalent per day, up 32% from a year earlier. The acquired interests were consolidated from May 1, so they contributed for only two months. Oil production reached 135,427 barrels per day, while Vista's average realized crude price rose 44% year over year to $89.40 per barrel.

The company reported second-quarter revenue of $1.212 billion and adjusted EBITDA of $805.2 million. Reported free cash flow was $99.1 million after $391.9 million of payments related to the Equinor transaction; excluding those payments, free cash flow was $491 million. Non-pro-forma net leverage was 1.41 times, while the pro-forma ratio was 1.25 times. Those figures show that the acquisition did not prevent deleveraging, but the third quarter must demonstrate that the performance can continue when the assets are included for all three months.

Volume should provide help. Bandurria Sur and Bajo del Toro added about 14,200 barrels of oil equivalent per day from May 1 during the second quarter, and their combined run rate was about 21,000. Vista also said July production reached roughly 162,000 barrels per day through mid-month. The investor question is how much of that output was sold, at what realized price and with what operating cost.

Costs could absorb part of the benefit. Second-quarter lifting cost rose to $4.50 per barrel of oil equivalent as peso-denominated expenses increased while exchange rates were relatively stable. Selling expense reached $4.10 per barrel of oil equivalent, partly because higher oil prices increased turnover tax. Strong revenue growth will be less valuable if local costs and taxes rise at a similar pace.

Management has targeted net leverage of about one times by year-end after spending $467 million on capital projects in the second quarter. Progress toward that level will indicate whether Vista can fund development, reduce debt and still consider share repurchases. Investors also need an update on the VMOS export pipeline, where logistics were affected by disruption around the Strait of Hormuz.

Vista has confirmed that it will release third-quarter results after the market closes on October 28, followed by a webcast on October 29. Revenue and production will attract attention, but realized pricing, unit costs, capital spending and free cash flow will determine whether the oil-price windfall strengthened the balance sheet or merely lifted the top line.

Developer KDC is seeking about $3.5 billion in private debt for AT&T's planned headquarters campus in Plano, Texas, according to Bloomberg Law. The proposed financing is unusually large for a credit tenant lease transaction and would be backed by future rent from AT&T rather than by an operating history at the new property.

CGA Capital and CBRE are arranging the transaction, which is expected to have a weighted-average life of 18.7 years. Credit tenant lease financing uses a highly rated tenant's long-term rental obligation to support debt service. That structure can lower a developer's financing risk, but it still depends on final lease terms, construction execution and lender appetite.

The scale stands out. PGIM Real Estate has described typical credit tenant lease transactions as ranging from $25 million to $100 million. A $3.5 billion package would sit far outside that range and may need multiple investors, tranches or other structural protections. The comparison does not make the deal impossible, but it shows why financing itself is a central part of the story.

Plano's incentive agreement requires AT&T to support at least $1.35 billion of construction. KDC previously obtained a $400 million construction loan from JPMorgan in May. Public filings describe an 11-building campus on 54 acres, with estimated project costs above $1 billion, a planned December 1 construction start and completion in March 2029.

Those figures do not yet reconcile into a final capital stack. The reported $3.5 billion financing request is larger than the construction commitment and filing estimates, and the detailed use of proceeds has not been publicly disclosed. CGA declined to comment, while other parties did not provide a response to Bloomberg Law. Terms could change before any financing closes.

For AT&T investors, the project is strategically relevant but not yet an earnings catalyst. The company would gain a consolidated headquarters built around a long lease, while the developer and lenders bear much of the upfront financing task. The effect on AT&T's cash obligations depends on rent, guarantees, commencement dates and accounting treatment that have not been disclosed in the report.

The next meaningful evidence will be a closed financing package and final construction timetable. Until then, the proposed headquarters is a large, credible development plan with an unresolved funding structure, not a completed transaction.

Starlink's third-quarter results put a measurable base beneath Elon Musk's ambition to build a connectivity business with several hundred billion dollars of annual revenue. SpaceX reported $5.25 billion of connectivity revenue for the quarter, up 69% from a year earlier and 22% from the second quarter.

The service ended the period with 13.6 million consumer customers. Consumer average monthly revenue per subscriber rose 5% sequentially to $69, while enterprise and government connectivity revenue increased 91% from a year earlier. Connectivity operating income reached $2.37 billion. These figures show that growth is coming from both subscriber additions and higher-value commercial and government services.

Musk's aspiration remains far above the current run rate. Annualizing the latest quarter produces about $21 billion of connectivity revenue, before allowing for growth or seasonality. Reaching $200 billion would require nearly ten times that annualized level, and a target of several hundred billion would require more. This is a scale comparison, not a forecast.

SpaceX is expanding the technical foundation for that growth. The company disclosed an agreement to acquire spectrum licenses, subject to regulatory approval and other closing conditions, with completion expected in the first half of 2027. It also received authorization related to additional second-generation satellites. Spectrum and satellite capacity can expand direct-to-device and broadband coverage, but permission to deploy is not the same as completed service or customer adoption.

The competitive benchmark is formidable. AT&T and Verizon together generated roughly $264 billion of revenue in 2025 across wireless, broadband and other services. Starlink does not need to copy their business mix, but the comparison shows the commercial scale implied by Musk's statement.

The investment case for SpaceX now rests on execution across three layers. It must launch and operate enough satellites, secure usable spectrum and convert capacity into paying consumer, enterprise, aviation, maritime and government demand. Capital intensity and regulatory timelines can slow that process even when customer demand is strong.

The quarter confirms that Starlink is already a large and fast-growing connectivity business. It does not validate a several-hundred-billion-dollar outcome. Investors should separate the verified operating trajectory from an undated aspiration and watch whether revenue growth, operating income and network capacity continue to rise together.

Comcast added 368,000 domestic wireless lines in the third quarter, taking its total to 10.6 million and lifting quarterly wireless service revenue 14.7% to $1.05 billion. The growth shows that Xfinity Mobile has become a meaningful product rather than a small bundle feature.

Wireless now reaches nearly 18% of Comcast's residential broadband customer relationships but only about 7% of the wireless lines available within those households. That gap gives the company room to grow without finding entirely new customers. Comcast can market additional lines to households it already serves, use one bill and one support relationship, and rely on its Wi-Fi footprint to carry part of the data load.

The company is also improving the mix. Premium unlimited plans accounted for about 40% of recent connections. Management said roughly 70% of customers whose free-line promotions expired converted to paid service, and about half of new postpaid connections came from those former free offers. Those figures suggest the strategy is producing recurring revenue rather than only promotional line counts.

Wireless does not yet offset the pressure in Comcast's core connectivity business. Domestic broadband customer relationships fell by 144,000 in the quarter, and domestic broadband revenue declined 4.7%. Revenue for the broader Connectivity and Platforms segment decreased 2.3%. Because broadband remains much larger and carries attractive economics, those declines matter more than the wireless growth rate alone.

The two products are connected. Wireless can reduce customer churn, add household revenue and make Comcast's broadband bundle harder to replace. But if broadband losses accelerate, the addressable base for that cross-selling strategy shrinks. Wireless growth is therefore both an opportunity and a defense for the larger franchise.

Investors should avoid treating every added line as equal. Paid conversions, service revenue, promotional costs and margins say more about value than gross additions. The third quarter was encouraging on those measures: service revenue grew at a double-digit rate and former free-line customers often stayed as paying users.

The decisive test is whether wireless can improve total household economics faster than broadband erodes. Comcast has proved that customers will buy the product. It still needs to show that wireless revenue and retention benefits can outweigh continued pressure on the business that supplies most of those customers.