Research from Water Tower Research, Water Tower Research

Water Tower Research

Research from Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

Equity Research Firm

Thematic (Sector/Industry)

<div><ul><li>The model tests the economics of the AI buildout. It maps spending from power and capex through clouds to end-market revenue, anchored on FactSet consensus for hyperscaler capex and cloud revenue while our assumptions for AI allocation, utilization, pricing and demand, and modeled intercompany transfers are eliminated.</li><li>Over time, we expect to use this model as a framework for evaluating new data points on capex, AI services revenue, and token pricing/consumption.</li><li>The buildout stays cash flow negative through 2030. AI capex rises from $824B in 2026 to $1.76T in 2030 ($6.7T cumulative) versus revenue of $306B and $1.56T. Cloud FCF is negative $530B and $588B, including assumed internal use benefits; infrastructure vendors generate $258B and $628B.</li></ul></div>

The model tests the economics of the AI buildout. It maps spending from power and capex through clouds to end-market revenue, anchored on FactSet consensus for hyperscaler capex and cloud revenue while our assumptions for AI allocation, utilization, pricing and demand, and modeled intercompany transfers are eliminated.Over time, we expect to use this model as a framework for evaluating new data points on capex, AI services revenue, and token pricing/consumption.The buildout stays cash flow negative through 2030. AI capex rises from $824B in 2026 to $1.76T in 2030 ($6.7T cumulative) versus revenue of $306B and $1.56T. Cloud FCF is negative $530B and $588B, including assumed internal use benefits; infrastructure vendors generate $258B and $628B.

AI Flow Industry Model : Tracking the Capex Flood and Revenue Streams

Semiconductor & Technology Specialist, Ingenuity

William Keating

Semiconductor & Technology Specialist

Ingenuity

Our focus is exclusively on in-depth research & consulting in the broader semiconductor industry. We focus on the key players, namely Intel, Micron, Qualcomm, Apple, Samsung, NVIDIA, AMD, TSMC & Global Foundries - as well as some of the lesser known, but nonetheless critical, companies such as ASML (for EUV), Mellanox, Cavium, Xilinx etc. We specialise in their products, roadmaps, process technologies, competitive advantages & threats etc. We also help our clients understand the implications of new and emerging technologies, e.g. 3D X-Point, 3D NAND, Carbon Nanotubes, Autonomous Driving, Graphene, Silicon Photonics, Wafer-Level Optics, Artificial Intelligence, FPGA, GPU, ASIC etc. 

Semiconductor Analysis & Research

Equity Bottom-Up

<ul>
<li>Upstream Strategy via Token Factory: Nebius is moving beyond basic bare-metal compute to capture a broader developer market through its managed inference platform, Token Factory, and emerging agentic abstractions.</li>
<li>Rationale behind recent acquisitions: these are great teams, quite rare talent, both in the area of inference optimization and model post-training. They will accelerate our journey with our inference platform</li>
<li>Diversification and Self-Built Data Centers: Nebius mitigates supply risks and expands margins by diversifying its customer portfolio across hyperscalers and AI natives, while building its own energy-efficient data centers.</li>
</ul>


Upstream Strategy via Token Factory: Nebius is moving beyond basic bare-metal compute to capture a broader developer market through its managed inference platform, Token Factory, and emerging agentic abstractions.
Rationale behind recent acquisitions: these are great teams, quite rare talent, both in the area of inference optimization and model post-training. They will accelerate our journey with our inference platform
Diversification and Self-Built Data Centers: Nebius mitigates supply risks and expands margins by diversifying its customer portfolio across hyperscalers and AI natives, while building its own energy-efficient data centers.


Nebius @ BofA Global Technology Conference 2026. Executive Summary & Full Transcript

Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

<ul><li>Nebius Group reported a robust start to 2026, marked by significant revenue growth, margin expansion, capacity buildout, and strategic acquisitions.</li><li>The company is focused on developing an AI-native hyperscale cloud across four dimensions: capacity and scale, product and functionality, customer demand, and capital availability.</li><li>In the first quarter, Nebius substantially exceeded prior capacity targets by contracting over 3.5 gigawatts of power and raising its full-year target to at least 4 gigawatts, including a new 1.2 gigawatt site in Pennsylvania slated to be fully operational by early 2030.</li></ul>

Nebius Group reported a robust start to 2026, marked by significant revenue growth, margin expansion, capacity buildout, and strategic acquisitions.The company is focused on developing an AI-native hyperscale cloud across four dimensions: capacity and scale, product and functionality, customer demand, and capital availability.In the first quarter, Nebius substantially exceeded prior capacity targets by contracting over 3.5 gigawatts of power and raising its full-year target to at least 4 gigawatts, including a new 1.2 gigawatt site in Pennsylvania slated to be fully operational by early 2030.

Nebius Group’s 4-Gigawatt AI Cloud Bet: Can NVIDIA’s $2 Billion Backing Pay Off?

<ul><li>Nebius Group N.V. has moved deeper into the AI infrastructure race with its agreement to acquire Eigen AI for approximately $643 million, payable through a mix of cash and Nebius shares.</li><li>The deal, subject to customary conditions including antitrust clearance, is designed to strengthen Nebius Token Factory, which the company describes as a frontier managed inference platform for production AI.</li><li>Eigen AI’s inference and post-training optimization layers are expected to be integrated into Token Factory, while its founding team is set to establish a Nebius engineering and research presence in the San Francisco Bay Area.</li></ul>

Nebius Group N.V. has moved deeper into the AI infrastructure race with its agreement to acquire Eigen AI for approximately $643 million, payable through a mix of cash and Nebius shares.The deal, subject to customary conditions including antitrust clearance, is designed to strengthen Nebius Token Factory, which the company describes as a frontier managed inference platform for production AI.Eigen AI’s inference and post-training optimization layers are expected to be integrated into Token Factory, while its founding team is set to establish a Nebius engineering and research presence in the San Francisco Bay Area.

Nebius Takeover Play: Why Eigen AI Could Rewrite Its AI Cloud Story!

<ul><li>The artificial intelligence boom has created a new kind of gold rush.</li><li>Companies are racing to build models, train algorithms, and deploy AI tools across industries.</li><li>But behind that race sits a less visible battle: the scramble for computing power.</li></ul>

The artificial intelligence boom has created a new kind of gold rush.Companies are racing to build models, train algorithms, and deploy AI tools across industries.But behind that race sits a less visible battle: the scramble for computing power.

Nebius Teams Up With Meta — And The AI Compute Race Is Heating Up!

Netherlands

Nebius Group is a technology company providing infrastructure and services to AI builders globally. The group's core business, Nebius, is an AI-centric cloud platform built for AI workloads. Nebius Group serves customers worldwide.

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Nebius Group (NBIS US)

AI Flow Industry Model : Tracking the Capex Flood and Revenue Streams

Over time, we expect to use this model as a framework for evaluating new data points on capex, AI services revenue, and token pricing/consumption.

Water Tower Research

Nebius @ BofA Global Technology Conference 2026. Executive Summary & Full Transcript

Nebius mitigates supply risks & expands margins by diversifying its customer portfolio across hyperscalers and AI natives, while building its own...

William Keating

Nebius Group’s 4-Gigawatt AI Cloud Bet: Can NVIDIA’s $2 Billion Backing Pay Off?

Nebius Group reported a robust start to 2026, marked by significant revenue growth, margin expansion, capacity buildout, and strategic...

Baptista Research

Nebius Takeover Play: Why Eigen AI Could Rewrite Its AI Cloud Story!

Nebius Group N.V. has moved deeper into the AI infrastructure race with its agreement to acquire Eigen AI for approximately $643 million, payable...

Baptista Research

Nebius Teams Up With Meta — And The AI Compute Race Is Heating Up!

The artificial intelligence boom has created a new kind of gold rush. Companies are racing to build models, train algorithms, and deploy AI tools...

Baptista Research

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