Core Viewpoint - The recent performance of VRT's Q4 FY2025 financial results and future guidance is noteworthy, indicating strong growth and demand in AI infrastructure [1] Financial Performance - For Q4 FY2025, the company reported a 252% year-over-year increase in organic orders, with an order shipment ratio rising to 2.9 times and backlog orders growing to $15 billion, a 109% increase year-over-year [2] - Adjusted operating profit increased by 33% to $668 million, while adjusted free cash flow surged by 151% to $910 million, leading to a 22.55% stock price increase on the reporting day, reaching a historical high [2] Strategic Outlook - The company raised its full-year outlook, projecting FY2026 net sales between $12.25 billion and $13.75 billion, representing an approximate 28% year-over-year growth, and adjusted earnings per share of $5.97 to $6.07, a 43% increase [3] - The Q1 guidance indicates net sales of $2.5 billion to $2.7 billion and adjusted earnings per share of $0.95 to $1.01, reinforcing market expectations for sustained growth in AI computing infrastructure demand [3] Industry Position - VRT is recognized as a leading player in global data center infrastructure, closely tied to major clients like Nvidia and Google, with significant barriers in liquid cooling and high-voltage power technologies attracting institutional attention [4] - Analysts, such as those from Evercore, maintain a "buy" rating, reflecting high order visibility, improved profitability, and structural trends driven by AI demand [4]

Core Viewpoint - Vertiv's stock surged by 25% following the company's optimistic outlook for 2026, which exceeded market expectations, alleviating concerns about a slowdown in the AI sector [1]. Group 1: Company Performance - Vertiv, a data center infrastructure provider, reported earnings that significantly surpassed expectations, contributing to the stock price increase [1]. - The positive earnings report indicates strong demand and growth potential for Vertiv in the data center market [1]. Group 2: Market Context - The surge in Vertiv's stock comes amid broader concerns regarding the sustainability of the AI trade, suggesting that the company's performance may be viewed as a counterpoint to these worries [1]. - The outlook for 2026 reflects confidence in continued growth within the data center infrastructure sector, which is critical for supporting AI technologies [1].

Fourth Quarter 2025 Results February 11, 2026 Cautionary Statement Regarding Forward-Looking Statements This presentation, and other statements that Vertiv may make in connection therewith, may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to Vertiv's future financial or business performance, strategies or expectations, and as such are not historical facts. This includes, without limitation, statements regarding Vertiv's financial ...

Summary of Key Points from the Conference Call on Liquid Cooling Market Industry Overview - The conference call focused on the liquid cooling market, particularly in relation to major players like NVIDIA and various Cloud Service Providers (CSPs) [1][2]. Key Takeaways NVIDIA's Liquid Cooling Solution Roadmap - NVIDIA is advancing its liquid cooling solutions, with a roadmap that includes partnerships with key suppliers such as Vertiv, Motivair, CoolIT, Boyd, and Delta [3]. CSPs' Liquid Cooling Solutions - The competition for Coolant Distribution Units (CDUs) in the North American market is expected to intensify by 2026 [3]. - Google has been deploying liquid cooling solutions for five years, now primarily using liquid-to-liquid solutions, with its CDU reaching the fifth generation and capable of handling 2,000 kW of power [5]. Supply Chain Dynamics - Certain Chinese suppliers have been shortlisted for Google’s liquid cooling solutions, although order allocations are not finalized [3]. - Other CSPs are still primarily using air-to-liquid solutions but are expected to transition to liquid-to-liquid solutions as their power requirements increase [5]. Pricing Trends - The price of air/liquid cooling solutions in China can be less than 50% of that in the North American market [6]. - Capital expenditure (capex) for air cooling solutions in China is approximately RMB 2,000-3,000 per kW, while in North America it is RMB 4,000-5,000 per kW. For liquid cooling, capex in China is around CNY 4,000-5,000 per kW, compared to over CNY 10,000 in the US [6]. Technological Advancements - Vera Rubin's rack power capacity has increased from 130 kW-140 kW to 220 kW-230 kW, indicating a shift from liquid-to-air to liquid-to-liquid cooling solutions [5]. - The microchannel lid (MLCP) solution may be implemented on the Rubin Ultra platform in the near future, while the Vera Rubin chip can utilize an upgraded cold plate to meet cooling requirements for chips with power less than 3 kW [5]. Additional Insights - The demand for chiller products is decreasing, which contributes to reduced total power consumption and improved Power Usage Effectiveness (PUE) [5]. - The competitive landscape in the liquid cooling market is becoming more intense, particularly in China, which may affect pricing and supplier dynamics [6]. This summary encapsulates the critical insights from the conference call regarding the liquid cooling market, highlighting the competitive landscape, technological advancements, and pricing trends.

Core Insights - Vertiv Holdings Co reported strong financial results for Q4 2025, with net sales of $2,880 million, a 23% increase from Q4 2024, driven by organic sales growth of 19% [1] - The company experienced a significant increase in organic orders, up approximately 252% year-over-year and 117% sequentially from Q3 2025, indicating robust market demand, particularly in AI infrastructure [1] - For the full year 2025, Vertiv achieved organic sales growth of 26%, with diluted EPS growth of 166% and adjusted diluted EPS growth of 47% [1] Financial Performance - Q4 2025 operating profit reached $580 million, a 27% increase from Q4 2024, while adjusted operating profit was $668 million, up 33% [1] - The adjusted operating margin for Q4 2025 was 23.2%, an increase of 170 basis points compared to Q4 2024 [1] - Full year operating cash flow was $2,114 million, and adjusted free cash flow was $1,887 million, reflecting increases of 60% and 66% respectively compared to the prior year [1] Future Guidance - For full year 2026, Vertiv expects diluted EPS in the range of $5.27 to $5.37 and adjusted diluted EPS between $5.97 and $6.07, representing increases of 56% and 43% respectively at the midpoint compared to 2025 [1] - The company anticipates net sales for 2026 to be between $13,250 million and $13,750 million, with organic sales growth projected at 27% to 29% [1] Market Dynamics - The Americas region and hyperscale/colocation data centers were primary drivers of order strength, with order growth being broad-based across regions, technologies, and customers [1] - The trailing twelve-month organic orders grew approximately 81% compared to the prior year period, reflecting strong demand in the data center market [1] - The Q4 2025 book-to-bill ratio was approximately 2.9x, with backlog increasing to $15.0 billion, up 109% year-over-year [1] Cash Flow and Liquidity - Vertiv generated $1,005 million in operating cash flow in Q4 2025, with adjusted free cash flow of $910 million, marking significant increases from the previous year [1] - The company maintained strong liquidity of $2.6 billion and a net leverage of approximately 0.5x at the end of Q4 2025 [1] - Vertiv deployed approximately $1 billion for strategic growth acquisitions during the quarter while maintaining a strong balance sheet [1]

Core Insights - The AI trade is experiencing a significant resurgence, particularly benefiting tech stocks as fears around AI spending have eased [1] - Vertiv Holdings has emerged as a key player in critical digital infrastructure, with its stock rising over 2,000% from under $10 per share during the 2022 bear market [2] - Vertiv's stock reached all-time highs of over $200 per share, reflecting a 25% gain in the current year, driven by its role in the AI ecosystem [3] Company Performance - Vertiv's growth has been significantly influenced by the surge in AI demand, particularly for data center capacity, where power and cooling solutions are critical [5] - The company has established itself as a leader in liquid cooling technologies, essential for high-density AI servers, and has formed partnerships with major chip manufacturers like Nvidia [6] - In the past year, Vertiv reported a 29% increase in organic net sales, with data center-related revenue becoming the primary growth driver [7] Market Position and Analyst Sentiment - Recent analyst upgrades and recognition of Vertiv's thermal solutions have highlighted its competitive advantages, particularly in a volatile market [9] - The upcoming earnings report is anticipated to show a 30% year-over-year increase in EPS, with revenues projected at $2.88 billion [10] - Analysts expect continued organic growth of over 20% for 2026, reflecting strong market confidence in Vertiv's future performance [11] Earnings Expectations - Vertiv has a positive Earnings ESP of +2.23%, indicating a potential for a positive earnings surprise in the upcoming report [13] - The company holds a Zacks Rank 2 (Buy), supported by positive estimate revisions and a history of exceeding earnings expectations [11]

Core Insights - Baron Small Cap Fund experienced a decline of 1.56% in Q4 2025, underperforming the Russell 2000 Growth Index, which gained 1.22% during the same period. The fund's total return for 2025 was -0.66%, trailing the index by 13.67 percentage points, indicating weak performance both absolutely and relatively [1]. Group 1: Fund Performance - The market showed positive trends in Q4 2025, but the Baron Small Cap Fund did not capitalize on this, resulting in a negative quarterly return [1]. - Large-cap growth stocks continued to lead the market for the third consecutive year, highlighting a concentrated leadership in the market [1]. - The firm anticipates better growth prospects for small-cap stocks heading into 2026 due to a solid market setup [1]. Group 2: Vertiv Holdings Co (NYSE:VRT) - Vertiv Holdings Co (NYSE:VRT) was highlighted as a leading contributor to the Baron Small Cap Fund, with a market capitalization of $74.778 billion [2]. - The stock closed at $195.58 per share on February 6, 2026, with a one-month return of 15.03% and a 12-month increase of 55.52% [2]. - Vertiv's shares rose significantly during the quarter, driven by robust financial results, including a 29% organic revenue growth, and the announcement of a $1 billion accretive acquisition [3]. - The company is positioned for growth due to its broad product portfolio and unique service capabilities, serving as a preferred solutions provider to major chip and hyperscale companies [3]. Group 3: Hedge Fund Interest - Vertiv Holdings Co (NYSE:VRT) was held by 102 hedge fund portfolios at the end of Q3 2025, a slight decrease from 104 in the previous quarter [4]. - While Vertiv is recognized for its potential, the company is not among the 30 most popular stocks among hedge funds, with some analysts suggesting that certain AI stocks may offer greater upside potential [4].

Core Insights - The artificial intelligence infrastructure boom is projected to lead to $7 trillion in data center investments by 2030, positioning Applied Digital to capitalize on this growth [1] - Despite the potential, the company's financials reveal significant concerns, particularly regarding its rising debt levels [1] Financial Overview - Applied Digital's debt has surged from $44 million in Q1 2024 to $2.6 billion, resulting in a debt-to-equity ratio exceeding 125% [2] - The company is heavily reliant on future lease revenue of $16 billion, primarily from two clients, with $11 billion coming from CoreWeave, which is also accumulating substantial debt [3][4] Customer Concentration Risk - The concentration of future revenue from a limited number of clients poses a significant risk, especially if CoreWeave fails to meet its obligations [3][4] Operational Risks - Applied Digital must adhere to strict construction timelines; failure to do so could allow CoreWeave to terminate leases without penalties [5] - Delays are common in large-scale construction projects, particularly for complex data centers, raising concerns about the company's ability to meet deadlines [7] Investment Outlook - While there is potential for significant upside if operations proceed smoothly, the high level of debt and associated risks make the investment landscape precarious [6]

Core Viewpoint - Galaxy Digital Inc. has announced a share repurchase program authorized to buy up to $200 million of its Class A common stock, reflecting confidence in the company's long-term prospects and a strong balance sheet [1][2]. Group 1: Share Repurchase Program - The share repurchase program allows Galaxy to buy back shares through various means, including open market purchases and privately negotiated transactions, subject to compliance with securities laws and stock exchange requirements [2]. - The program will last for 12 months and can be suspended or discontinued at any time, with no obligation for the company to acquire any specific amount of common stock [2]. - Repurchases through Nasdaq will not exceed 5% of the common stock issued and outstanding at the start of the program, and the timing and total amount of repurchases will depend on various market conditions [2]. Group 2: Company Overview - Galaxy Digital Inc. is a global leader in digital assets and data center infrastructure, providing solutions that enhance progress in finance and artificial intelligence [3]. - The company operates a digital assets platform that offers institutional access to trading, advisory, asset management, staking, self-custody, and tokenization technology [3]. - Galaxy's Helios campus in Texas, with a capacity of 1.6 GW, positions it among the largest and fastest-growing data center developers in North America [3].

Core Insights - The artificial intelligence (AI) boom relies heavily on advanced graphics processing units (GPUs) and the necessary infrastructure, including power delivery and cooling systems, to support data centers [1] Group 1: Company Overview - Vertiv (NYSE: VRT) is positioned as a key player in the AI infrastructure sector, focusing on liquid-cooling systems for high-performance data centers [2] - The company provides thermal management solutions that enhance data center efficiency by preventing overheating and reducing hardware downtime [2] Group 2: Growth Potential - Vertiv reported a 1.4x book-to-bill ratio and a backlog of $9.5 billion, indicating strong revenue visibility through 2026 [4] - The company is upgrading its liquid-cooling portfolio to meet the increasing demand from denser server racks and complex thermal requirements in AI facilities [4] Group 3: Services and Competitive Advantage - Vertiv offers services such as predictive analytics, remote monitoring, and energy optimization, supported by a global team of over 4,400 engineers [5] - These services are expected to provide a competitive edge as AI workloads become more complex, fostering customer loyalty and recurring revenue opportunities [5] Group 4: Future Investments and Developments - The company anticipates a more than 20% increase in engineering, research, and development spending by 2026 [6] - Vertiv plans to introduce an 800-volt direct current (DC) portfolio in the second half of 2026, aligning with Nvidia's rollout of Rubin Ultra platforms in 2027 [6] Group 5: Stock Valuation - The stock is currently trading at 35.2 times forward earnings, which may seem high, but the potential for growth alongside AI data center expansion makes it a viable long-term investment [7]