AI Arms Race: Nebius Vs. CoreWeave Has One Clear Winner

Apr. 02, 2025 12:03 PM ETNebius Group N.V. (NBIS) StockCRWV, NBIS29 Comments
(6min)

Summary

  • The AI industry is still thriving, and investing in AI hyperscalers like Nebius and CoreWeave offers significant profit potential.
  • Nebius is more diversified, debt-free, and has strategic European exposure, making it a better investment than CoreWeave.
  • CoreWeave's heavy reliance on Microsoft and substantial debt pose significant risks, despite its higher revenue and cheaper valuation.
  • Nebius's diversified revenue streams, lack of debt, and positioning in Europe make it a clear buy over CoreWeave.
  • This idea was discussed in more depth with members of my private investing community, The Pragmatic Investor. Learn More »
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Thesis Summary

Has the AI bubble popped? There appears to be some evidence to suggest that, but also plenty of spending going into the industry and many companies enjoying the benefit of this technology.

If this rally is going to

This is a high-risk/high-reward opportunity, which is exactly what I look for in my YOLO portfolio.

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This article was written by

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James Foord is an economist by trade and has been analyzing global markets for the past decade. He leads the investing group The Pragmatic Investor where the focus is on building robust and truly diversified portfolios that will continually preserve and increase wealth.

The Pragmatic Investor covers global macro, international equities, commodities, tech and cryptocurrencies and is designed to guide investors of all levels in their journey. Features include a The Pragmatic Investor Portfolio, weekly market update newsletter, actionable trades, technical analysis, and a chat room. Learn more.

Analyst’s Disclosure:I/we have a beneficial long position in the shares of NBIS either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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