[Click eStock] “Pado, Expecting Performance Recovery with New Client Acquisition and Increased Orders”

NH Investment & Securities analyzed on the 30th that Pado is showing a recovery in performance along with inventory depletion of major clients, and especially by securing new clients, it is further increasing its growth potential.

Ryu Young-ho, a researcher at NH Investment & Securities, stated in the report on the same day, "The inventory clearance of major clients is entering the final stage, and performance recovery is being observed from the second half of the year."

The third-quarter performance recorded sales of 10.09 billion KRW, a 3044.9% increase compared to the same period last year, recovering sales above 10 billion KRW for the first time in six quarters. However, operating losses continued at 30.54 billion KRW. Regarding this, researcher Ryu explained, "The larger-than-expected deficit is due to new projects and increased R&D."

Pado is focusing its investments more on AI servers rather than general servers, and investments in general servers are closely related to Intel's new product shipments. Researcher Ryu forecasted, "Full-scale new product shipments are expected to begin in the first half of 2025, which could lead to additional performance recovery."

Particularly positive is the fact that Pado has reduced its dependence on a single client by securing new overseas clients. Although sales from new clients are still in the early stages, full-scale sales are expected to begin in 2025. Researcher Ryu emphasized, "The company's sales structure is diversifying through securing new clients, and performance recovery is expected due to increased orders from both new and existing clients."

Meanwhile, Pado experienced a sharp decline in sales due to reduced investments from major clients after its listing but is gradually recovering. Researcher Ryu analyzed, "If the expansion of general server investments by major clients becomes visible in 2025 and sales from new clients begin in earnest, the performance improvement trend will continue," adding, "In the mid to long term, as major competitors like Marvell Technology focus on the data center sector and show less interest in the existing controller business, there is an opportunity for the company to expand market share and strengthen its position."