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.

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<div><ul><li>The “Whiplash” State of AI. OpenAI just closed the largest private funding round in history at $110B. Nebius guided 2026 capex to $16–20B, roughly 4x 2025 levels, and CoreWeave guided to $30–35B, more than doubling last year’s spending, substantially all tied to signed contracts.</li><li>On the other side, Block cut 40% of its workforce citing AI efficiencies, while Anthropic’s guardrails dispute with the Pentagon escalated into a supply chain risk designation and broader federal phase-out.</li><li>Meanwhile, the macro economy is lagging, with 4Q25 GDP growth at 1.4%. </li></ul></div>

The “Whiplash” State of AI. OpenAI just closed the largest private funding round in history at $110B. Nebius guided 2026 capex to $16–20B, roughly 4x 2025 levels, and CoreWeave guided to $30–35B, more than doubling last year’s spending, substantially all tied to signed contracts.On the other side, Block cut 40% of its workforce citing AI efficiencies, while Anthropic’s guardrails dispute with the Pentagon escalated into a supply chain risk designation and broader federal phase-out.Meanwhile, the macro economy is lagging, with 4Q25 GDP growth at 1.4%. 

AI Flow Newsletter : Monitoring The "Currents" Of AI - 3 March 2026

<ul><li>Methodology. We reviewed 50 under-covered, AI-involved public companies (~$2.7 billion average market cap; about five analysts each) and their respective one-year market-cap changes.</li><li>We then mapped them to one or more of 11 AI application areas.</li><li>We also assigned each company a subjective “AI Centricity” score (1 to 10 scale) based on each company’s level of focus on AI. </li></ul>

Methodology. We reviewed 50 under-covered, AI-involved public companies (~$2.7 billion average market cap; about five analysts each) and their respective one-year market-cap changes.We then mapped them to one or more of 11 AI application areas.We also assigned each company a subjective “AI Centricity” score (1 to 10 scale) based on each company’s level of focus on AI. 

AI Industry Primer A Survey of 50 Under-Covered Companies in Artificial Intelligence (AI)

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 Industry Primer A Survey of 50 Under-Covered Companies in Artificial Intelligence (AI)

Methodology. We reviewed 50 under-covered, AI-involved public companies (~$2.7 billion average market cap; about five analysts each) and their...

Water Tower Research

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AI Flow Newsletter : Monitoring The "Currents" Of AI - 3 March 2026

We remain highly bullish on AI capability and adoption, but job displacement is real and gains are concentrating, not spreading.

Water Tower Research

AI Industry Primer A Survey of 50 Under-Covered Companies in Artificial Intelligence (AI)

Methodology. We reviewed 50 under-covered, AI-involved public companies (~$2.7 billion average market cap; about five analysts each) and their...

Water Tower Research