Updated Aug 7 at 11:21am ET.
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Michael Burry has disclosed that he is shorting Nebius, meaning he has made a bet that the stock price will fall. Burry, who became famous for predicting the 2008 housing market crash, suggested that many companies tied to artificial intelligence have become overvalued and are now vulnerable to a drop.
While Burry is a high-profile investor, a short position is simply one person's view on the stock's current price rather than a change in the company's actual business. Nebius is still growing its revenue rapidly as it builds out data centers for AI, and its long-term value will depend on whether it can meet its goals for expanding its fleet of specialized computer chips.
Nebius has appointed Lindsey Irvine as its new Chief Marketing Officer. She previously led marketing at Square and Benchling, and spent over a decade at Salesforce. This hire comes as the company tries to move beyond its roots as a Russian internet spinoff and establish itself as a global provider of specialized computing power for artificial intelligence.
Landing an executive with experience at major American tech firms is a positive sign for the company's credibility. To reach its goal of becoming a top European cloud provider, Nebius needs to win over large global AI labs that currently rely on giants like Microsoft or Amazon. This role will be central to building that brand and proving the company can compete on more than just having the right chips in stock.
Source: Business Wire
Analysts expect the company to report revenue of about 580 million dollars and a loss of roughly 61 cents per share. This report will be a key test of whether the company is successfully converting its massive investments in data centers and chips into growing sales. We will be watching for updates on its data center expansion in Finland and any signs that its customer base is widening beyond a few large AI labs.
Building the massive computing clusters needed for AI requires a lot of electricity and water for cooling. This report shows how the company is designing its own servers and cooling systems to manage those costs. While environmental data is routine, it highlights the engineering work the company is doing to keep its data centers efficient as it grows.
Source: Business Wire
Nvidia, the company that makes the chips essential for AI, disclosed it holds about 22 million shares. This is a strong vote of confidence from a critical partner. It suggests the two companies are closely aligned, which is vital because the business relies on getting a steady supply of Nvidia's high-end hardware to rent out to its own customers.
Source: CNBC
Analysts recently lowered their price targets following a sharp drop in the stock price and negative news reports. Eight of nine analysts still rate the stock a buy, and the average target of $227 suggests 24% upside.
The company has a habit of beating expectations, often outrunning what analysts predict even while it spends heavily to grow. It suggests management has a good handle on its expansion costs.
| Expectation | |
|---|---|
| EPS | $-0.72 |
| Revenue | $570M |
Watch and listen
Bloomberg Podcasts · Video · May 13
Reading
Business Insider · Aug 7
Business Wire · Press release · Aug 5
Seeking Alpha · Opinion · Aug 3
Business Wire · Press release · Jul 30
Seeking Alpha · Opinion · Jul 29
Finbold · Jul 22
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