Group 1 - Nebius Group (NASDAQ: NBIS) is an emerging AI infrastructure company that is vertically integrated, designing its own data centers, building its own racks, procuring its own compute, and deploying its own AI software layer [1] - The company's operations require core competencies that span several areas, indicating a comprehensive approach to AI infrastructure [1]

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or ...

In the first article, Nebius Group: Well-Positioned To Be An AI Megatrend Winner , we were among the first to introduce the Nebius opportunity to Seeking Alpha readers. We summarized the coreAnalyst’s Disclosure: I/we have a beneficial long position in the shares of NBIS either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any c ...

Since my last coverage on Nebius Group ( NBIS ) , the stock has pulled back roughly 16%, offering investors a chance to accumulate shares near the recent $21 private placement price secured by institutional backers like Nvidia (Yiannis Zourmpanos, founder of Yiazou IQ, an AI-driven stock research platform providing all-in-one stock reports. Experience: Previously worked at Deloitte and KPMG in external/internal auditing and consulting. Education: Chartered Certified Accountant, Fellow Member of ACCA Global, ...

Core Insights - Nebius (NBIS) is a full-stack AI neocloud that is making significant advancements in the GPU infrastructure sector, with its platform and software fully optimized for machine learning workloads, distinguishing itself from major hyperscalers [1] Group 1: Company Overview - Nebius focuses on providing a comprehensive AI cloud solution, specifically tailored for machine learning applications, which sets it apart from traditional cloud service providers [1] Group 2: Industry Context - The company’s approach contrasts sharply with that of the largest hyperscalers, indicating a niche market strategy that may appeal to specific segments of the AI and machine learning industry [1]

Core Insights - Nebius Group N.V. (NASDAQ: NBIS) has experienced significant volatility, with its stock initially surpassing $50 per share before declining over 58% [1] Group 1: Company Performance - The stock of Nebius Group N.V. has shown a dramatic decline after reaching a peak, indicating potential instability in its market performance [1] Group 2: Analyst Perspective - Daniel Sereda, a chief investment analyst, emphasizes the importance of filtering vast amounts of data to identify critical investment ideas, reflecting the challenges faced by investors in the current market [1]

Core Insights - A company has resumed trading on NASDAQ after a 2-year hiatus, generating quarterly revenue of $38 million while holding $2.5 billion in cash [1] Company Overview - The company recently returned to the NASDAQ, indicating a potential recovery or strategic repositioning after a significant absence [1] - The substantial cash reserves of $2.5 billion suggest strong liquidity and potential for future investments or acquisitions [1] Financial Performance - The company reported quarterly revenue of $38 million, which may indicate a stable revenue stream despite the previous trading suspension [1]

Core Viewpoint - Nebius Group N.V. (NBIS) has experienced a significant decline in its stock price, dropping 24.6% over the past month, which is a stark contrast to the minor declines in the broader market indices [1][3]. Group 1: Reasons for Underperformance - The primary reason for Nebius Group's underperformance is the divestment of its stake in Yandex at a heavily discounted price of RUB 475 billion ($5.2 billion), which is 50% below the fair market value of the assets [3]. - Following the divestment, Nebius Group lost several high-margin businesses, including Search, Advertising, Mobility, E-commerce, Food Delivery, and Cloud Services, retaining only its international AI and cloud-focused division [4]. - The company's net loss increased to $136.6 million in Q4 2024, up from a loss of $94.2 million in Q3 2024, indicating ongoing financial struggles [5]. Group 2: Financial Estimates and Analyst Sentiment - Analysts have adjusted their bottom-line estimates for Nebius Group, widening the expected loss for 2025 by 20 cents to $1 per share, reflecting a pessimistic outlook [6]. - Current estimates for the upcoming quarters indicate a loss of $0.39 for Q4 2024 and $0.41 for Q1 2025, with the full-year loss for 2024 projected at $1.10 [7]. Group 3: Operational Challenges - Nebius Group faces operational challenges due to the extended lead times for customer deals, which require prolonged proof-of-concept testing and complex contract negotiations [8]. - The reliance on semiconductors in the AI market exposes the company to regulatory risks, including potential U.S. tariffs on the EU, which could disrupt supply chains and increase costs [9]. Group 4: Competitive Landscape - Nebius Group competes with established cloud service providers like Amazon, Microsoft, and Alphabet, which have more robust financial resources and established AI-centric cloud platforms [10][13]. - Unlike Nebius Group, these competitors have developed their own hardware solutions, such as Alphabet's Tensor Processing Units, giving them a competitive edge in AI and machine learning services [12]. Group 5: Technical Indicators - Technical indicators for Nebius Group suggest a bearish trend, with the stock trading below the 50-day moving average, indicating potential further downside [14]. Group 6: Conclusion - Given the operational and competitive pressures, along with weak financials, it is suggested that investors should avoid Nebius Group stock at this time [16].

Group 1: Nvidia - Nvidia's stock has decreased over 12% year to date despite strong earnings and product innovations, leading to a forward P/E ratio of 26, which is lower than peers like Apple and Microsoft [2][4] - Over the past year, Nvidia's diluted EPS has increased by 72%, with revenue up over 340% and earnings up over 680% over the last three years, although future growth is expected to slow [4][5] - Nvidia maintains a strong balance sheet with more cash and marketable securities than long-term debt, allowing for continued investment in R&D even during downturns [7] Group 2: Vertiv Holdings - Vertiv's shares have dropped 22% year to date due to a market sell-off in AI stocks and disappointing near-term news regarding European orders [8][9] - Despite flat orders year over year in Q4, full-year orders rose by 30%, and management forecasts a 16% organic revenue growth and a 25% increase in adjusted operating profit for 2025 [10][11] - Vertiv is currently trading at 17.7 times Wall Street estimates for free cash flow in 2026, which is considered cheap for a stock with double-digit revenue growth prospects [11] Group 3: Nebius Group - Nebius is an AI infrastructure company that is less recognized than Nvidia but is expected to grow as the industry expands, providing indirect exposure to Nvidia [12][15] - The AI infrastructure segment accounts for over 50% of Nebius's revenue, with plans to launch its first Nvidia GPU cluster in the U.S. and deploy over 22,000 Blackwell GPUs in 2025 [13][14] - Nebius reported sales of $117.5 million, with a projected annualized run rate of $750 million to $1 billion by December 2025, although the company is currently incurring losses [14][15]

Core Insights - Nebius Group's stock has experienced a significant decline of 21% over the past month despite positive developments within the company [1] Company Developments - The article highlights that there have been numerous positive developments for Nebius Group during the period since the last earnings report [1]