Nebius Group: A Leading AI Infrastructure Provider with Strong Growth Potential and Institutional Demand

Nebius Group (NBIS) is a stock with a Zacks Rank #3, indicating strong potential for growth. As an artificial intelligence (AI) infrastructure provider, the company offers a full-stack AI solution to its customers and is benefiting from the booming AI infrastructure market.

Nebius AI provides the backbone and compute power for companies like Microsoft (MSFT) and Alphabet (GOOGL) that are building the most powerful AI systems in the world, such as the ChatGPT and Gemini large language models (LLMs). Essentially, the company is akin to a specialized electricity company, providing the lightning-fast computer power and technology needed for AI.

What makes Nebius special is its unique product offering:

• Own Supercomputers: Nebius builds and operates its own data centers filled with the latest and most advanced graphic processing units (GPUs). Big tech companies like Microsoft can rely on NBIS data centers and use them as a service.
• Competitive Pricing: Because Nebius is focused solely on AI solutions, it can provide more competitive pricing than general cloud providers.
• Supplemental Products: Nebius's laser-focus on AI also allows it to offer a full suite of products that extend beyond just compute power. Its add-on software solutions make running AI models simpler and more efficient.

Nebius has key partnerships with Nvidia (NVDA) and Meta Platforms (META). The company builds proprietary hardware like servers and racks, allowing it to vertically integrate its business. It has partnered with Nvidia to leverage the industry-best Nvidia GPUs and access powerful 'GPU clusters' to run AI models at scale. Meanwhile, Meta leverages NBIS technology to train its Llama large language model.

Recent earnings call suggest that NBIS is gaining traction with a broad swath of new customers. Zacks Consensus Analyst Estimates suggest that annual revenue will soar at a triple-digit clip for the next two years.

NBIS shares are breaking out of a bull flag pattern as volume swells to more than 60% above the 50-day norm, signaling institutional demand. The pattern sets up potential pre-earnings run into earnings next month.

In conclusion, Nebius is an AI company positioned at the epicenter of the booming AI infrastructure market. The company's proprietary supercomputers, full suite of AI solutions, and competitive pricing mean that the stock will likely move much higher from current levels.

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