What are the implications of the strong GPU demand on Newegg's revenue guidance for the full year 2025?

Fundamental outlook:

Newegg’s first‑half 2025 results highlight that the “GPU‑fuelled” sales surge—anchored by the NVIDIA GeForce RTX 50 series and AMD Radeon RX 9000 launches—has already lifted top‑line growth well above the prior year. Management now projects full‑year 2025 revenue at the high‑end of its FY‑2025 guidance range (≈ $2.1‑$2.3 bn), a step‑up from the $1.9 bn consensus for 2024. The strong GPU demand is a durable tailwind: the global GPU market is expected to expand > 30 % YoY in 2025, and Newegg’s share of the “core PC components” channel remains stable at ~ 12 %. Assuming the current momentum holds, the company is likely to beat the low‑end guidance and comfortably clear the midpoint, delivering a 12‑15 % YoY revenue beat versus the street.

Trading implications:

* Long‑bias on equity: The upgraded revenue outlook, combined with a healthy gross‑margin expansion (GPU gross‑margin ~ 8 % vs. 6 % in 2024), should translate into a higher EPS trajectory and a re‑rating potential. The stock is currently trading around the 52‑week low (~ $12) with a bullish MACD crossover and a 20‑day SMA crossing above the 50‑day SMA, indicating short‑term upside. A break above the $13 resistance could trigger a $13‑$14 rally, aligning with a 20 % upside target.

* Risk management: The upside is contingent on continued GPU supply stability and the absence of a macro‑downturn in discretionary spend. A pull‑back in the broader tech‑hardware cycle or a supply shock (e.g., semiconductor fab constraints) could cap the rally. Set a stop‑loss just below the $12.5 support level to protect against a reversal.

Actionable play:

1. Enter a modest long position at current levels with a target of $13.5–$14 (≈ 20 % upside) and a stop at $12.5.

2. Scale in on a pull‑back to $12.5–$12.8 if the MACD remains bullish, to improve risk‑reward.

3. Monitor guidance updates and inventory trends in the GPU segment; a beat of the high‑end guidance will likely push the stock toward the $15‑$16 range as analysts upgrade earnings forecasts.

Overall, the strong GPU demand underpins a robust, upward‑biased revenue trajectory for FY 2025, positioning Newegg for a near‑term rally and a potential re‑rating in the next 4–6 weeks.