Key Findings
The model's thesis centers on Q4's 38% sequential explosion in inventory to $255M, which Gemini argues is 'not shelf-ware' but staged hardware for committed AI infrastructure deployments. Historical patterns for PENG show such inventory builds are 'almost perfect leading indicators' for revenue acceleration.
Thesis
Gemini projects the hardware-heavy AI revenue will support revenue scale driving operating margin expansion despite flat nominal OpEx. The model acknowledges mix shift may dampen gross margin percentage slightly to ~27.5%, but volume leverage dominates.
What This Means
This is a data-driven call based on balance sheet analysis rather than narrative. Investors focused on traditional metrics may be missing the inventory signal that Gemini identifies as predictive of near-term revenue acceleration.