$CBRS The first financial report after going public has been released, and on the surface, the performance looks decent, but it's still a long way from disrupting NVIDIA...

The Q1 figures themselves are good, with revenue nearly doubling year-over-year.
But the guidance for Q2 and the full year shows some lack of momentum, even predicting that the core gross margin will drop from 47% in Q1 to around 38%.
This is almost unacceptable, so a 10% decline after hours is already considered quite modest.
But why is the gross margin dropping?
The current explanation is that demand is too high, and their production capacity can't keep up. The company is trying to deliver as quickly as possible by using more expensive temporary capacity, even renting back systems they've already sold to customers.
So, the higher the revenue, the more difficult short-term profits become when capacity is insufficient.
This point is relatively neutral, with pros and cons.
After all, their current mining farm model, compared to simply selling hardware, has the advantage of potentially larger and more sustained income.
The downside is that initially, they need to spend a lot of money on equipment, rent data centers, power infrastructure, and increase capacity.
The marginal cost is high.
The company says their long-term gross margin target can exceed 60%, but currently, the full-year margin is less than 40%, and the gap is significant.
The only hope is that, with their differentiated technology, as inference markets explode, low-latency inference will become increasingly valuable, and we will see if their profit margins can be significantly restored.