Huang Renxun has begun his European tour! What investment opportunities are there?
The profit effect is strong! NVIDIA's heavily weighted stocks are soaring across the board, closely monitor these 6 companies and 3 major directions!
AI trading has returned to the market spotlight.
Recently, $NVIDIA (NVDA.US)$ It has captured the market's attention, rebounding over 40% from its low.Market cap surpasses Microsoft, once again crowning it as the world's most expensive company.
Besides NVIDIA itself,the key sectors and companies it invests in and focuses on are also favored by the US stock market.
Specifically, in the past 20 trading days, CoreWeave, known in the market as NVIDIA's favored child, skyrocketed over 200%; data center operator NEBIUS and Applied Digital rose over 154% and 57%, respectively; and the AI Medical company $Recursion Pharmaceuticals (RXRX.US)$ increased by over 18%, $Arm Holdings (ARM.US)$and the autonomous driving company$WeRide (WRD.US)$have also recorded increases.
It is worth noting that Applied Digital, a NVIDIA concept stock, recently signed a new AI data center leasing agreement with CoreWeave, which will provide CoreWeave with 250 megawatts of critical IT load, expected to bring approximately $7 billion in revenue to Applied Digital during the contract period.This news also stimulated a surge of over 90% for Applied Digital in three trading days.
Specifically, the six companies that NVIDIA is betting on mainly coverComputing & Chips, Autonomous Driving, AI Medicalthree major directions.
Direction 1: Computing & Chips
– NVIDIA's three beloved computing powers—— $CoreWeave (CRWV.US)$ 、 $NEBIUS (NBIS.US)$ 、 $Applied Digital (APLD.US)$
1. CoreWeave: closely intertwined with NVIDIA, possessing outstanding large-scale computing cluster management capabilities.
According to Caitong Research Reports, $CoreWeave (CRWV.US)$ Founded in 2017 starting with mining, accumulated a large number of GPUs through its predecessor Atlantic Crypto, and later explored transformation due to the collapse of cryptocurrency prices, acquiring second-hand GPUs at low prices and shifting to provide high-performance computing rental services in AI, film, and other fields.
The launch of ChatGPT in 2022 sparked a global AI wave.CoreWeave has rapidly risen due to its Bare Metal GPU model and powerful computing supply capabilities.In 2023, it established a deep partnership with NVIDIA and attracted major clients including OpenAI, Meta, and Microsoft, focusing on AI computing rental.It has become one of the most influential AI core infrastructure providers in North America.
CoreWeave operates 32 data centers, running over 0.25 million GPUs, mainly serving major North American clients such as Microsoft, NVIDIA, OpenAI, Meta, and Google.CoreWeave focuses on GPU-powered computing rental services, has 32 data centers, over 0.25 million GPUs, and primarily targets top clients in North America, such as Microsoft, NVIDIA, OpenAI, Meta, and Google, to meet customers' rapidly growing computing needs while increasing their capital expenditure flexibility.
NVIDIA's preference for CoreWeave has reached a level of 'treating it as one's own.'After receiving investment from NVIDIA, CoreWeave has become a direct cloud computing supplier for NVIDIA, and even Microsoft has to order cloud computing from them.
In addition, according to the latest reports,CoreWeave has reached an agreement with the artificial intelligence company OpenAI worth up to 4 billion dollars, which will last until 2029, aimed at providing additional cloud computing capacity.。
It is worth noting that Microsoft is one of OpenAI's biggest supporters and also one of CoreWeave's most important customers. According to documents submitted to the U.S. Securities and Exchange Commission, Microsoft is one of CoreWeave's two major customers in 2024, contributing nearly two-thirds of total revenue.Expanding the partnership with OpenAI may help CoreWeave reduce the risk of over-reliance on Microsoft.
2. Applied Digital: A provider of data center solutions.
$Applied Digital (APLD.US)$Founded in 2001, it is a U.S. company focused on designing, building, and operating next-generation digital infrastructure and high-performance computing data centers.APLD mainly meets the computing needs of mining, AI, ML, and other compute-intensive applications by providing data center hosting, cloud services, and high-performance computing hosting solutions, relying on advanced NVIDIA GPU technology and innovative cooling systems to ensure customers receive efficient, scalable, and secure computing support.
NVIDIA's investment in Applied Digital further demonstrates its deep involvement in the AI infrastructure field. As the demand for AI computing power surges across various Industries, Applied Digital has become a key player in AI infrastructure services with scalable and cost-effective solutions.
3. NEBIUS: Benefiting from European support and winning with short-term rental cost-effectiveness.
According to Caitong Securities, $NEBIUS (NBIS.US)$The predecessor is the Russian technology giant Yandex, whose Business spans search, maps, ride-hailing, music, and streaming.After the Russo-Ukrainian conflict in 2022, Yandex faced significant geopolitical changes, initiating a strategic reorganization to withdraw from the Russian market. In October 2024, Yandex officially completed the spin-off with Nebius. The reborn Nebius relies on Yandex's AI capabilities and the expertise in building hyperscalers to attract a large number of AI infrastructure talents, going all in on computing resource leasing and entering the global AI infrastructure construction by offering large-scale GPU resource cluster leasing services and related development tools.
Nebius offers full-stack AI solutions,including Nebius AI Cloud, which provides various development tools, and Nebius AI Studio, which supports model testing, as well as services such as data annotation purchasing, staff training, and self-driving technology.Nebius data centers are located in multiple areas in Europe and America, with customers being relatively dispersed.composed of large AI training laboratories, startups, and internal AI teams of enterprises. Nebius’s business composition is more complex than CoreWeave, and it is more cautious in terms of capital expenditures.
$Arm Holdings (ARM.US)$ It is a chip company that does not make chips, generating revenue through the sale of chip architecture licenses. Specifically, ARM's profit model mainly has two types: one is the licensing model (Upfront license fee), accounting for 40% of total revenue; the other is the patent royalty model (Royalty fee), accounting for 60% of total revenue.
The licensing model refers to the fact that When other companies design chips using Arm's architecture, they need to pay a licensing fee each time, which mainly reflects the value of Arm's technology and market demand.
Patent royalty modelIn this case, after chip manufacturers use Arm's architecture and sell the produced chips, Arm takes a commission based on a certain percentage, meaning it charges a fee per chip or device based on the partner's shipment volume, which mainly reflects the sales situation and market share of the partner's products.
Among them,The royalty fee is Arm's most profitable business, yet its pricing is not high, which is also an important reason why its market share reaches 99%, but its revenue and profit scale are not particularly large.
Direction two: AI Medical
– Leader in AI drug development - Recursion Pharmaceuticals
$Recursion Pharmaceuticals (RXRX.US)$ It is a clinical-stage biotechnology company.Focusing on using Artificial Intelligence (AI) technology to accelerate drug development.The company is centered around AI technology and is dedicated to drug discovery, precision medicine, treatment of rare diseases, oncology, and neuroscience.
According to media reports from the Gazelle Society,RXRX's data and computing power are quite impressive,In 2024, the company's supercomputer BioHive-2 made its debut, known as the largest supercomputing system in the pharmaceutical industry. NVIDIA's powerful computing capability can provide computational support for RXRX's AI drug development.
RXRX focuses on using Computer Vision and machine learning algorithms to analyze cellular image data,to identify potential therapeutic effects. By constructing a vast biological image database and training deep learning models to predict the impact of compounds on cells, RXRX can rapidly screen promising new drug candidates. In the AI pharmaceutical industry, RXRX is at the forefront with its unique technological path and service model, providing new ideas and methods for tackling difficult diseases and developing new drugs.
Direction Three: Autonomous Driving
– The world's first publicly traded Robotaxi - WeRide
$WeRide (WRD.US)$ Focusing on unmanned driving technology, WeRide is a leader in this field, using NVIDIA's advanced GPUs and artificial intelligence software to power its vehicles, which are currently running autonomous taxis in multiple cities.
WeRide's revenue primarily comes from two parts of its Business: sales of L4 autonomous vehicles, such as autonomous taxis (Robotaxis), autonomous sanitation vehicles (Robosweepers), and related sensors; and providing L4 autonomous driving and ADAS auxiliary driving services, such as operation and technical support, ADAS R&D services, etc.
NVIDIA is an early investor in WeRide. Founded on L4, WeRide's rise has been accompanied by a host of star investors: Qiming Venture Partners, Xiaopeng Motors founder He Xiaopeng, IDG, Mubadala, Innovation Works, during which it received olive branches from industry giants such as the Renault-Nissan-Mitsubishi Alliance, NVIDIA, Bosch, GAC, Yutong, and Uber.
In addition, it is noteworthy that recently Uber committed to an additional equity investment of 0.1 billion dollars in WeRide on top of existing investments. Sources reveal that this investment will be completed in the coming months. It is reported that this is Uber's largest investment in the field of autonomous driving to date.
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