Q4 2024 Nebius Group NV Earnings Call
No.
[music].
Speaker Change: Hello, and welcome to <unk> fourth quarter, and full year 2024 earnings conference call.
Speaker Change: Neil Doshi head of Investor Relations, joining me today to discuss our results.
Speaker Change: <unk> founder and CEO and the rest of the management team before we get started I would like to take this opportunity to remind you that our remarks. Today will include forward looking statements actual results may differ materially from those contemplated by these forward looking statements factors that could cause these results to differ materially are set forth in <unk>.
Speaker Change: Today's earnings press release and in our quarterly report on form 6K filed with the SEC any forward looking statements that we make on the call are based on assumptions as of today and we.
Speaker Change: Undertake no obligation to update these statements as a result of new information or future events.
Speaker Change: During this call we will present, both GAAP and certain non-GAAP financial measures a reconciliation of GAAP to non-GAAP measures is included in today's earnings press release. The earnings press release is available on our website at <unk> Dot Moebius Dot com.
Speaker Change: <unk> Investor Dash hub, and now I'd like to turn the call over to archiving.
Archiving: Thank you Neal and welcome everyone to <unk> fourth quarter earnings call.
Speaker Change: As we said.
Speaker Change: In our last call. Our aim is to build one of the worlds largest AI infrastructure companies.
Speaker Change: We believe that we are well positioned to do this because we have a proven track record of building and running efficient data centers with stable, Poland, delivering GPO base, a compute intersection cloud and offering a wide range of value added services to businesses that the adult T. G I.
Speaker Change: Chiefly publically launched the abuse in July with less G. M. Just seven months ago.
Speaker Change: We have been extremely focused on putting in place the foundation to support our future growth in 'twenty five and below.
Speaker Change: And he owned.
Speaker Change: I'd like to share.
Speaker Change: What we accomplished in the fourth quarter alone.
Speaker Change: First we resumed trading as a public company and extolled, becoming the first publicly stated AI specialized cloud.
Speaker Change: This came much faster than expected as we were still building, our corporate and business functions.
Speaker Change: We also raised $700 million in capital in December in an oversubscribed offering a deal that saw the likes of Nvidia axial orbis and either enter or pivotal step change.
Speaker Change: On the infrastructure side, we successfully expanded our datacenter footprint and our GPU deployments.
Speaker Change: And we are building the foundation, which will enable us to aggressively scale up this year in the U S and Europe.
Speaker Change: Also we launched our new E. A closed platform and migrated all of our customers state in Q4.
Speaker Change: We also launched our influence as a service platform called a studio.
Speaker Change: And we paid make we made the great progress in building, our global sales and marketing team or with a particular focus on the U S market.
Speaker Change: In that context.
Speaker Change: I'm very pleased with everything we're able to accomplish in Q4.
Speaker Change: Our sales function is now up and running and we are seeing the results.
More clients are coming onto the platform and our more diversified customer base is a way to contributing to strong rules around rates revenue.
Speaker Change: Based on current contracts already in place March analyzed run rate revenue will be at least $220 million.
Speaker Change: And we have more potential contracts in the pipeline.
Speaker Change: Given this momentum as well as the anticipated impact of additional data center capacity that we are building as a little bit.
Speaker Change: As Nextgen nation Blackwell.
Speaker Change: GPU coming online later this year, our projected December 2025, and our lives run rate revenue of $750 million to $1 billion is well within reach.
Speaker Change: Looking ahead to 2025, we have basically three strategic focus area.
Speaker Change: The first is a is always unique.
Speaker Change: We'll stick to AI technology.
Speaker Change: In addition to our European and European Datacenters in Finland, and France.
Speaker Change: We started deploying GPU clusters in Iceland, and in Kansas City, which was the first capacity in the U S.
Speaker Change: For US also we will soon be announcing our first U S data centers that we will be build to own design.
Speaker Change: And we will continue.
Speaker Change: To enhance and expand our E Bay, a cloud and influences the service buffers.
Speaker Change: The second.
Speaker Change: Areas of focus.
Speaker Change: Does the capital to invest in our future growth.
Speaker Change: At the end of last year, we had $2 $4 billion in cash.
Speaker Change: Including those $700 million raised in Q4.
Speaker Change: Hum Heico's investors.
Speaker Change: And being a public company, which also gives us access to a wide variety of efficient financing options.
Speaker Change: And finally well.
Speaker Change: Another focus airplanes is in our corporate section.
Speaker Change: Here, we have been particularly focused on our sales and marketing and customer support teams will make great hire strong within our industry in the last quarter and we are already seeing positive results in terms of run rate savings in growth as we start to 2020 five.
Speaker Change: In addition to our core infrastructure business.
Speaker Change: All our businesses and business units are doing very well.
Speaker Change: Avi ride our autonomous technology platform business signed a contract with older is one of just three autonomous technology partners in the U S in language Women's Oaks.
Speaker Change: Where it's heavily deployed as rates Roberts for food delivery in Austin, Dallas and Jersey City.
Speaker Change: If you're right also signed the contract with Grub hub, which now uses iterate robots fulfill giveaways for college campuses across the United States, starting with the highest state University.
Speaker Change: In addition, if the rates for all of US have recently received certification in Japan.
Speaker Change: The deal will start to explore contagious in Israel.
Amit: Hello, Amit.
Amit: David trading platform for Ginnie I grew full year.
Amit: Revenue by 140%.
Amit: And diversify discussed them at base by adding several of the leading a labs to teach clients are Glen for 14.
Amit:
Amit: He'll also completed its transition to a new platform of which is in June for complex journey, a task such as red teaming foyer agents emulation, ovaries, and remodels and scalable paying by quoting and loss expense.
Amit: Stapleton.
Amit: Ed Tech business medication Tech business doubled his team in Houston and additions.
Amit: Year over year and 24.
Amit: And maintains its position as one of the leading I T bills comes in U S based Fintech big.
Amit: Finally, as a reminder, we still own 28% stake in glucose and which we believe is a significant potential source of value. Although it is not part of our consolidated results.
Well all know 'twenty to 'twenty four.
Amit: Was just at the starting point for native enables group.
Amit: And I'm excited to enter 2020 price with significant momentum and big ambitions to scale and grow our business.
Tom: And now I turn over to Tom completions.
Tom: Thank you very much at Ekati and thanks to those of you who've already center your questions, we'll try and cover as much ground as we can on this call.
Speaker Change: Actually the first question is about capacity expansion plans and so I'll actually come to Anthony current income for this first one in February can you discuss a little bit more of that broader plans for capacity expansion of in 2025.
Troy chemical: Troy chemical thank you.
Tom: Hi, everyone.
Tom: So we forget them into 2025, let me quickly recap what we did last year.
Tom: We announced tripling the capacity of her what basins or in Finland.
Tom: The expansion is going well the construction is going according to the schedule for the first part of the delivery to be completed in Q3, and the remaining capacity will come online around year end.
Tom: We also added a data center facility in France, which is already up and running.
Tom: And recently announced our first U S cluster in Kansas City reaches now in deployment phase.
Tom: It should be up and running by the end of this quarter.
Tom: For 2025, we are already well underway in scaling up further.
Tom: We can announce today that we are deploying and U H 100, crusher in Iceland, which we expect to be available for customers in March.
Tom: And with the additions of iPhone than Kansas City. It takes our total current capacity to around 30000 Gpus most of the week H two hundreds.
Tom: I'm also pleased to announce.
Tom: That we just signed a significant new built to suit facility in the U S. Specifically agreed for Blackhawk deployments and we will update on the details soon.
Tom: Our guidance for guidance calls for.
Tom: 100 megawatts.
Tom: In the durations by end of this year.
Tom: And we are on track to deal with it.
Tom: Also I would like highlight that all of these new facilities are potentially scalable go in total.
More than 300 megawatts as and when.
Tom: We are ready to do so.
Tom: We are working on even further expansion focusing on greenfield sites in U S and Europe that will increase our capacity.
Tom: Multiple times.
Tom: Thank you. Thank you very much Andre.
Speaker Change: And actually next question, our cardio come to you on that as it relates to you. So the question is that in some of your recent public compare and says you talked about potential growth in capacity that went beyond the stated guidance can you give us an update in terms of how you're thinking about capacity expansion generally.
Speaker Change: Well I think what you're referring to is.
Speaker Change: My comments today listening to this conference.
Speaker Change: Louis and heading into a more general discussion about the overall market of Tianjin, which we believe is huge.
Speaker Change: And I.
Speaker Change: And during that conversation off with the volatility and potential for building a gigawatt and more of capacity if we see that the demand is there.
Speaker Change: And I still believe that the advantage of having 18 like ours, which with decades of.
Speaker Change: Experience of building hundreds of megawatts of Datacenters and the specific.
Speaker Change: Got it.
Speaker Change: Gives us disadvantage and as Andy said, we already have over 300 megawatts secured.
Andy: And we know how to scale it will will much more loves it.
Thanks, everybody and then I'll I'll stick with U S and in the press release that you reconfirmed reiterated the 2025 <unk> guidance. A question is why how are you thinking about that and what it what is it gives you the confidence that you'll be able to achieve it.
Andy: Well there are a number of factors that give us confidence in our full year.
Andy: I haven't heard of any run rate guidance.
Andy: Jos we were significantly scaling up our data center capacity this year, and we will have more than enough to support this our number.
Andy: And second.
Andy: We also have not yet deployed all of L. Even to H 200, Gpus and we have the black holes visuals and coming in line online. Later. This year. This is Megan will be the main.
Speaker Change: So it's a low income.
Speaker Change: And finally wave.
Speaker Change: <unk> entered the 20th ratified as was said was very great.
Speaker Change: Great momentum.
Speaker Change: As I said earlier, even with existing capacity and based on contracts already in place, our Marcia and I will be at least $220 million and we have more potential deals to come soon.
Speaker Change: So.
Speaker Change: We feel very good that we are willing track to hit our guidance.
Speaker Change: For the end of 'twenty five.
Speaker Change: And actually in reality, we believe that the scale opportunity could be even much much bigger.
Arkady: Thank you Arkady.
David: David One question about Q4 in there and the revenue in Q4 of them and I Wonder if I can come to you to just explain a little bit of how we saw that the revenue dynamics in the last quarter.
David: Yeah. Thank you Tom.
David: Okay talking about delaying our Q4 revenue and.
Analyzed Randy.
David: Randy your run rate at the end of Q4 I believe these score.
David: Mostly timing issues.
David: The two are very statistic for Q4 and now we feel that we have very much on track.
David: And if we deepened some details.
David: What we observed is.
David: The deal with.
David: With customers.
David: The lead times, who are taking longer than we.
David: Observed.
David: And the previous periods of.
David: 2024, as customers became much more selective and wanted to do more in depth proof of concept testing or proof of the POC is and so on but we believe this was in the two light.
In addition.
David: We've had a couple of large customers that completed their engagements with us in Q4.
David: This was anticipated, but because of the longer lead times, we were not able to replace them before the end of the year.
David: We are also launching on UA, a cloud platform and put a lot of efforts to move all of our customer base to the new version of the platform.
Reach took some resources to support this integration.
David: Now we are done with that and fully focused on scaling.
David: It's also worth to mention that during this period who are.
David: Very much.
David: Busy building, our tower sales and marketing teams.
David: Essentially we had to do it from the stretch we are.
David: Pleased with our efforts, but many of these hires come late in the quarter came late and they go out there and.
David: We are now starting to see the early results in terms of new contracts finally.
David: But to reiterate as archive said this was more a timing issue and we are back on track in 2025.
Okay. Thank you very much at all that and actually I'll I'll I'll stay with you in fact, it picks up on a topic that you briefly addressed there around the sales function. So can you give a little bit more color in terms of the ramp up at the at the sales function and just sort of generally.
David: When you think you left that see that flowing into additional deals and revenue.
David: Sure I think we've had.
David: We made very good progress on hiring front and are.
David: You're starting to see the benefits.
David: With new customer additions and a ramp up in revenue in this quarter.
Kelly: Like our Kelly mentioned.
Kelly: Generally speaking we were very focused on building, our sales marketing and customer success function in U S because as.
Kelly: As you can imagine a lot of our customers come from U S.
Kelly: And.
Kelly: Lee.
Regardless, the fact that we brought on board.
Kelly: <unk> strong people normally it takes like six months or more of our new sales hires to become fully productive.
Kelly: Come to the full capacity.
Kelly: So I believe we are moving in a very right direction now and we see.
Kelly: Some results already.
Kelly: But the growth opportunity ahead of US is huge and we will continue to develop our sales marketing and other customer related functions.
Kelly: Back to that.
Kelly: Thanks, very much Robin and actually one more for you which is around the customers continue to give some color in terms of the types of customers that we're working with and attracting and also if there's anything you can comment on in terms of length of contracts that we're seeing.
Kelly: Yeah, so in terms of customers.
Kelly: I want to emphasize that we are building a very flexible platform that let us attract and work with a wide variety of customers from small ones too large.
Kelly: Enterprises.
Kelly: We currently see that many of our customers saw obviously native journey I start tops and tech native companies.
Kelly: Are these kinds of customers, who appreciate the flexibility.
Kevin: The ability of the platform the fact that hey, Kevin.
Kelly: Spinout.
Kelly: Quickly and provide them services and flexible model.
Kelly: And we also see that the mixture of the contract is pretty diverse diverse. So we do we see.
Kelly: Some short term on demand.
Kelly: Contracts that we actually benefit from because we believe one of the provider.
Kelly: One one of the player in the market Hogan.
Kelly: Really serve cloud type of workloads.
Kelly: But as the Blackhawks come on stream, we anticipate moving to more of a mix of short term as well as long term contracts since at.
Kelly: At the beginning of generation of Blackhawk's, we expect to sign longer term contracts.
Kelly: Okay, that's great and just to remind that said or the investors on the line you can send your questions via the chat function.
Kelly: Okay. So.
Okay. We have a question actually about the competitive environment and Daniel I'll come to you on this one.
Kelly: And so it really is basically can you help us sort of think about what the competitive environment looks like now.
Kelly: <unk> made a reference to longer deal time is that because you see the market, becoming more competitive in and generally how do you see it and how do you see the market evolving going forward yeah. Thanks, Tom.
Speaker Change: Women did touch on this but I'll see if I can add a little more color commentary to it in terms of market developments are the.
The longer lead times for deals or less a function of increased competition in the market and more just a reflection of the increasing maturity of our customers coupled with the larger scale of the opportunities that we're seeing now versus six months ago.
Speaker Change: That's where the competition on the customer side, we're now seeing longer proof of concepts and Rowan mentioned that with new customers and so as we build out our AI specific cloud platforms and its functionality. We expect this trend should work in our favor.
Speaker Change: As were not only able to demonstrate our price advantage, but also the quality and flexibility of our platform and then finally in terms of I think the question asked about scale.
Speaker Change: We're increasingly working with customers looking for clusters in the multiple thousands of GPU size range logically. These are more significant investment decisions and and so they take a little bit longer from a sales cycle perspective.
Speaker Change: Okay.
Speaker Change: That's great. Thank you very much Daniel.
Speaker Change: And.
Speaker Change: Okay. So actually.
Speaker Change: That's a question that's coming through about deep sea, obviously that the deep seek took the market a little bit by storm.
Speaker Change: Two weeks ago.
Speaker Change: And they basically the question is.
Speaker Change: What do we think about it and what has been the impact that we've seen on our business of any I Paddy maybe I can ask you Ted to give some thoughts on that one.
Speaker Change: Oh well.
D C just highlight that.
Speaker Change: The nature of this market is very dynamic.
Speaker Change:
Speaker Change: And it was a great example that demonstrates that our senses yield went to deploy flexible and extend to our AI focused cloud infrastructure is working.
Speaker Change: Because if we were able to actually can meet.
Speaker Change: The demands of the customers.
Speaker Change: At the infrastructure level, we saw incremental demand for sales has an immediate cheaps H two hundreds because that was the best precision around the influence of the pig.
Speaker Change: So we had a.
Speaker Change: The spike in demand.
Speaker Change: For those chips in the end of January.
Speaker Change: Yeah.
Speaker Change: By the way that we are we are.
Speaker Change: Hostile.
Speaker Change: Hum.
Speaker Change: We had this.
Speaker Change: The unexpected demand and.
Speaker Change: Oh.
Speaker Change: We're hopeful that they will be more deep seek something on the way.
Speaker Change: The interface very young and these kind of things.
Speaker Change: Diptych, specifically it shifts lowered the bar for the really good high end models.
Speaker Change: And which actually will hit that will help our Tokyo as the growth of the whole industry.
Speaker Change: Thank you for that Ekati.
Speaker Change: So just going through.
Speaker Change: <unk>.
Speaker Change: Got a question around the full stack I to finance that we talked a lot about how we see that as a as an interesting advantage against our peers in the space and question is really you know.
Speaker Change: Can you just give us a bit more color on how we're thinking about full stack why why why we see it as an advantage and what type of customers that are utilizing particularly the software layer at the top end of the stack and so maybe Daniel maybe Daniel I can come to you on that one yeah.
Daniel: Yeah. Thanks, Tom So I do think that when we consider our direct competitors in this space and really the entire landscape having a full stack approach is is the thing that sets us apart.
Daniel: But it's important to understand what that means for us. It's it's really four main components. The first one is or our ability to leverage our experience in building operating and operating Datacenters, specifically with high power intensive workloads that we see across the AI landscape. We have we are experts at building.
Daniel: Hi, P E R power use efficiency and laying the foundation of our cost advantage amongst our neo cloud peers. So that's that's a really important first component with that we couple our our expertise in developing our own hardware from servers racks motherboards cooling. This gives us a a more.
Daniel: Mass of advantage in terms of our ability to provide the most cost effective solution on the market and then we couple that with a third component, which is the AI specific cloud platform that we've built from the ground up and built it in a way that that is it is targeted and bespoke to AI workloads and this this is what help.
Daniel: US deliver the flexibility and reliability that our customers need, especially as theyre looking to providers to help them navigate the sometimes choppy waters of deploying AI infrastructure and then the last component or the value added services.
Daniel: This helps us extend the economic life of our Gpus and extends.
Daniel: A greater value well above a pure bare metal offering.
Daniel: In turn this gives us a better an enhanced way to return cash.
Daniel: To create a return on capital invested and also creates new robust revenue streams for the company that enable us to to command software like margins. So we're very excited about the from the top to the bottom of the stack all of the innovation that <unk> is bringing to market going forward, we think pure bare metal offerings will.
Become more commoditized and as our investments now across a full stack, especially at the top end of the stack that are going to pay the biggest dividends in the mid to long term.
Daniel: Okay, that's great that Daniel Thank you very much.
Daniel: <unk>.
Daniel: One second.
Speaker Change: Okay. So I'd actually there's debt there's a question around hardware deployment plans for this year and today at Agco, maybe I can come to you on this one can you update generally and analyst said more specifically when do you expect to be able to deploy that the GBT hundreds and <unk> hundreds in the next blackout theories.
Daniel: Sure them.
Daniel: So as of now we are continuing with the deployments of digital Congress.
Daniel: And the last deployed its 200th who will be available to their customers in late March or early April.
Daniel: And right after that we will be switching to the blackboard.
Daniel: Blackboard generations.
Which will include <unk> hundred GBP 200.
Daniel: G. B 300 later in the year.
Daniel: Vito hundreds would be available.
Daniel: In Q2, Jeep vehicle hundreds should be available in the platform.
Daniel: In Q3.
Daniel: And after that as I said earlier like later this year, we plan to deploy G. B three hundreds.
Very good rural waiting for the Blackhawks to come on stream until thank you Andre.
Daniel: So.
Daniel: Next question is maybe Neil actually perhaps I can come to you on this one is really about the the question is as we're trying to model the business how should we be thinking about the cadence of revenue revenue run rate in revenue over the year.
Daniel: Tom.
Daniel: We really are in the early days of building our business. There are many variables, including how quickly we can build datacenters time of GPU delivery deployment and availability of those gpus.
Andre: Andre mentioned, we have more than a more H two hundreds coming online in Iceland in Kansas City by April.
Andre: And then we will have GPU appointments for backlog coming on after that so.
Andre: We're excited to see those backlogs come online and as Roman also said you know our sales team is ramping up but it takes about six months for that team to get fully productive. So putting all these elements together, we expect that most of our air and revenue will come in the second half of the year and we'll probably be weighted more towards the towards the end.
Andre: Of the year.
Neil Doshi: Okay. Thank you Neil.
<unk>.
Neil Doshi: Okay. So the next question is actually about investment plans as of 2026 and beyond is specifically, our thinking about raising capital to support those future expansion plan. So I'm happy to take that one eight right now and the film.
Neil Doshi: Management focuses on executing the plan for 2025.
Neil Doshi: As I reiterated in the press release today and as I mentioned, we're targeting to exit the year with an a or a 752 1 billion and again based on what we've been seeing and the very positive dynamics coming into 2025, we see that we are very much we didn't we didn't reach at that target.
Neil Doshi: And at the same time, we're looking at the roadmap for the next generation of Gpus.
Neil Doshi: This is actually to be 300 GB three hundreds in the bank's rather out Rubens and where I think we're just really at the stage, where we're still assessing the scope of addressable demand beyond 'twenty five.
Neil Doshi: It's too early to comment specifically in publicly at this stage, but it obviously is that God. He mentioned Dana we believe that the opportunity here is very significant.
Neil Doshi: Generally speaking when we're thinking about going forward in a day, our our aim is to move really at foster as aggressively as we can to grow the business and maximize value for our shareholders.
Neil Doshi: And this will clearly require significant capsule that goes beyond what we currently have.
Neil Doshi: But we're very confident in our ability to continue funding. This growth we've seen very very strong interest and demand from different sites and we'll be opportunistic in terms of when and how we raise.
Speaker Change: So I got another question now that it goes back kind of comes back into the next generation back both theories and aroma and maybe I can come to you on this one.
Speaker Change: We launched our pre sales at GBT, hundreds and <unk> hundreds right at the very end of 2024.
Speaker Change: Can you update about the progress is there and what what is the feedback that you're getting from the market around the next generation.
Speaker Change: Yeah, I can comment on this.
Speaker Change: The first place.
Speaker Change: A minute to mention that we're still working through the initial customer demand for black clothes.
Speaker Change: Which is obviously the function of delivery of deployment timelines.
Speaker Change: But I already can say that at this stage newmont is positive and we expect to.
Speaker Change: Complete pre sales for air.
Speaker Change: A portion of the initial deliveries.
Speaker Change: So we.
Speaker Change: We now discussing a variety of preserve contracts Lang from one year and higher.
Speaker Change: And Oh, we have.
Speaker Change: Different levels of pre commitments.
Speaker Change: Multiple thousands of Gpus are ahead of our they've been deliberate.
Speaker Change: So at this point.
Speaker Change: We see positive dynamics.
Speaker Change: It's supported by the ongoing.
Speaker Change: Airports are.
Speaker Change: And building our sales and marketing.
Speaker Change: And as well as solid demand from the market overall.
Speaker Change: And yeah, we will update you in.
Speaker Change: And the next calls.
Speaker Change: How the development of locals going.
Speaker Change: Okay. Thank you very much robin.
Speaker Change: One moment.
Speaker Change: Okay. So actually.
Speaker Change: The next question is around return on invested capital and again collections that how should the market be thinking about capex investments and what's the general return that we expect to be able to receive on those investments.
Neil Doshi: Maybe Neil paths that can come to you on that question.
Neil Doshi: We seem to get this question quite a bit.
Neil Doshi: So if you think about the hopper generation of Gpus.
Neil Doshi: We were really excited about this especially with the H 200 coming on line and based on some of our calculations. We believe that the payback period is somewhere between the two and a half to three year range and when it comes to Blackwell the claim that payback period on the Blackwell, It's a little too early to say what that.
It'll be.
Neil Doshi: But you know I went to Canada.
Neil Doshi: Put into perspective that there are certain other elements to our business that we think can actually.
Neil Doshi: That payback period, a little bit faster. So first that we're able to to build very efficient data centers, we have developed our own racks and servers and so we think that static that's an area of cost savings.
Neil Doshi: In addition, we are a full stack business and as a full stack business. We have additional value added services that we can offer that could really help accelerate that ROIC C.
Neil Doshi: Has that software layer is a high margin element to our business. It's still a very small today that that software piece that we think that as we grow our customer count and we start building more tools.
Neil Doshi: In software and services, we think that can actually be a nice contributor to revenue and margin than had helped that helped with the ROIC.
Speaker Change: Okay, great. Thank you Neil.
Speaker Change: So we've had a few questions actually just asking about how things are going with the with the other businesses with telecom Triple Tan and Navy right and so I've got it perhaps I can ask you to address that and give it give a sense of where things are going with the three.
Speaker Change: Okay, Let me go back to them again.
Speaker Change: They're all growing very well said.
Speaker Change: Well Tullow OCA to Loca grew revenue again, 148% on in 2024 versus time, So you see.
Speaker Change: And last year, they actually pivoted the platform to focus on more experts rather than just simple crowdsourcing delivery.
Speaker Change: And.
Speaker Change: Maybe most important that they added almost all of the leading AI allows as their customers.
Speaker Change: Virtually all the big names.
Speaker Change: In Templeton are they also had a great year revenue was up even higher 250%.
Speaker Change: And they ended last year was 14000 students and most of them in the U S.
Speaker Change: Which was of course very good.
Speaker Change: And the.
Speaker Change: Sure.
Speaker Change: David.
Speaker Change: You know.
Speaker Change: Probable on either right.
Speaker Change:
Speaker Change: Is you saw the a cam.
Speaker Change: Into a partnership with <unk> in the U S.
Speaker Change: Uh Huh, alright deliver aerobics already is being tested in various markets.
Speaker Change: Whether it's in Dallas Austin Jesse.
Speaker Change: And the cars are expected to come into service later this year.
Speaker Change:
Speaker Change: <unk> also entered into a partnership with Grub hub are where we will provide also robots for food delivery on college campuses.
Speaker Change: When he says they deployed around 100 robots for food delivery service at our highest state University.
Speaker Change: And they already have the first week the elite that made more than 100 deliveries a day.
Speaker Change: Which was a great start.
Speaker Change:
Speaker Change: Yeah.
Speaker Change: Sorry.
Speaker Change: Thousands of diversity.
Speaker Change: 778 hundred a week.
Speaker Change: 77 Springs.
Speaker Change:
Speaker Change: Oh well.
Speaker Change: Yeah.
Speaker Change: Isn't it also received a certification in Japan.
Speaker Change: And he's starting explained but he is not.
Speaker Change: Our country and we think Japan is.
Speaker Change: Yet another huge opportunity to cool when it was a.
Speaker Change: Relative to the cars.
Speaker Change:
Speaker Change: And as we are told before we.
Speaker Change: We are planning to bring one or more pointless to this business.
Speaker Change: And as we said this is yet another business with substantial capital requirements.
Speaker Change: But at the same time with a great market opportunity, which became or business unit.
Speaker Change:
Speaker Change: So there's nothing specific with placebo.
Speaker Change: The new co.
Speaker Change: Co investments right now, but with different too.
Speaker Change: Keep everyone updated.
Speaker Change: The things progress.
Speaker Change: Thank you very much I had a and I'll just for the benefit of everyone. The language to Agco and confirmed a couple of the numbers that we misspoke. So with the Grubhub partnership average got off to a great start we deployed around 100 robots already for food delivery service and they were already showing 1000 daily deliveries in the first week alone so wet weather.
We're very pleased with how that's going and again, we see a lot of opportunity there in and around that space and a lot of interest in it from the outside.
Speaker Change:
Speaker Change: Okay. So just to remind you again, please keep your questions coming through the chat function, we still have a little bit more time.
Speaker Change: There's been a question on <unk>.
Speaker Change: Regulatory guidance actually I read it out it how does the U S. Ifr on framework for artificial intelligence diffusion impact the outlook for the <unk> core business I'm happy SaaS web and MBS will be able to qualify for universal verified end user status under rose.
Speaker Change: So I'm happy to have unhappy to have a go at that one.
Speaker Change: <unk>.
Speaker Change: While it remains to be seen how the framework will be implemented in practice.
Speaker Change: And if indeed, there will be any changes.
Speaker Change: Our initial reading of the tax as it stands right now is that at being in Netherlands headquartered business with US current largest data center in Finland and.
Speaker Change: And also a very significant part of our expansion being focused in and around the U S market.
Speaker Change: We sort of anticipate that we'll be able to qualify for <unk> status.
Speaker Change: And we don't anticipate any material negative impact on our business prospects at this time, but again, it's a little bit early and it's still we will be watching it and still remains to be seen how it's all going to be implemented in practice.
Speaker Change: Okay, So actually <unk>.
Speaker Change: Continuing on the kind of the regulatory side of things.
Speaker Change: So there is a question, which says that we stated previously that we're servicing U S clients when a lot about data centers. Currently are in the are in the U S. S assigned in the EU and done do we see any risks to the business. If tariffs are introduced against you as President Trump has indicated.
Speaker Change: Now considering a corporate relocation to the U S. A.
Speaker Change: Residential and it indicates a lot of things are but as of now we don't again, we don't see any material risks to our business in this regard and again, while it's indeed, our initial data center footprint started in Europe. We're now actively building out our physical footprint in the U S and it's both in terms of data.
Speaker Change: Centre as well as GPU hardware as well as the team so on and so we believe that we're going to continue to be very well positioned to service you asked and global customers from our data center footprint around the world. So.
Speaker Change: In terms of the crop in terms of the sort of corporate headquarters is I need a I'll headquarters there in Amsterdam.
Speaker Change: Ed.
Speaker Change: We're happy Yeah, but I think as a global business.
Speaker Change: During the needs of AI companies around the world Medicare in the U S. It obviously makes sense for us to keep building out on the ground presence in the U S. So and today with Eylea outlined some of the specific plans surrounds that Tc footprint expansion in GPU cluster expansion in the U S.
Speaker Change: Arcata, you and Rob I make reference to the fact that we've been really building out the sales function again with a real focus on the U S market and you might remember, we announced that we opened up with sales and customer facing offices in San Francisco and Dallas are.
Speaker Change: And I will continue to be building up the U S presence going forward. So notes I think that the military that was a long winded way of saying, we don't anticipate any but there are many material risk around this around tariffs. We think that we have the right geographic spread and just being able to continue to develop very efficiently on both sides.
Speaker Change: Okay.
Speaker Change: So there's a question about the Stargate projects and potentially European style game.
Speaker Change: And whether essentially that'd be it can be a beneficiary. So just for context I'll I'll I'll add so that makes reference to what we had during the week of Davos about the U S plans to invest $500 million in AI infrastructure.
Speaker Change: Not long after that trans came out with that plan to invest $100 billion in AI infrastructure and generally that's been a lot of interested enthusiasm around these big Megaprojects insecticides I got it maybe I can come to you for how you are thinking about those projects and essentially what that could mean for us.
Speaker Change: Well, we are definitely believers that he answer such as a huge opportunity.
Speaker Change: And so it was good to hear that Theres. So much focus on this space now.
Speaker Change:
Speaker Change: I just think that when time comes probably later this year someone who need to come in and build it all of this.
Speaker Change: And I think we Oh technology and.
Speaker Change: Of know how to how to build all this AI cloud datacenters in scale.
Speaker Change: I believe.
Speaker Change: We're just.
Speaker Change: One of the best companies.
Speaker Change: Company dispositions here too to help build.
Speaker Change: Somebody here.
Speaker Change: Okay and.
Speaker Change: Thank you. Thank you very much our coding.
Speaker Change: Yeah.
Speaker Change: Okay. So there's a question around around pricing and so.
Neil Doshi: Robyn I'll come to you on this one and there's been some depth in the discussion that price declines, but the H one hundreds in Q4 of last year and.
Speaker Change: Did you experience there and how the market dynamics changed in the last few months.
Speaker Change: Yeah. So we have all the market did see some price pressure in Q4.
Speaker Change: It was partly expected.
Speaker Change: S H two hundreds came online.
Speaker Change:
Speaker Change: But in general we believe that Leo one of those have a one of the best cost structures in the market and we can be successful even on that price pressure situation.
Speaker Change: And what is more important that going forward. The significant majority of our fleet will be in the new generations of chips.
Speaker Change: Like all of these here.
Phil Com: Phil Com on <unk>.
Phil Com: Higher pricing and we believe we are well positioned on this front to get healthy margin on new generation of the chips.
Phil Com: Okay.
Phil Com: Okay great.
Speaker Change: So there's actually a question that's come through asking to clarify where we are at 10 says Gpus in terms of what's already been deployed I know you touched on that briefly on today in one of your earlier remarks that may be I can ask you to come back to that center and elaborate.
Phil Com: Elaborate a little bit on where we are in GPU capacity.
Speaker Change: Sure.
Speaker Change: So.
Speaker Change: What we what I already mentioned is a 38 will have around 30 thousands.
Speaker Change:
Speaker Change: By the end of March are deployed in the blood from them available for the customers.
Speaker Change: Went to thousands of which eight hundreds and just to remind that.
Speaker Change: We actually started deploying these numbers for the last half a year.
Speaker Change: Acyclovir and age the hundreds or kimco the deployment time in late October November and so the lifespan and deployment time corrosive Q.
Q4 second half of the Q4 and the first well in Q1 definition.
Speaker Change: So San Francisco for example.
Speaker Change: Yeah.
Speaker Change: No.
Speaker Change: Okay I.
Speaker Change: Thank you thank you Andre.
Speaker Change: Okay.
Speaker Change: Maybe I can come to you for a question again around the revenue and EBITDA guidance. So are we.
Speaker Change: We provided guidance on the last call and in light of everything can you provide an update on the guidance separately.
Speaker Change: Yeah. So you know as as you read in our press release and and heard from Arcata. His prepared remarks, we did reiterate our annualized run rate revenue guidance for exiting 2025 at $750 million to $1 billion.
Speaker Change: And so this would.
Speaker Change: It would basically be a REIT reiteration of our of our of our revenue and EBITDA guidance that we provided previously so just as a reminder, we said revenue for Navias group should be in the range of 500 million to $700 million and for EBITDA, We said that EBITDA will remain negative for the full year.
Speaker Change: We should pass breakeven at some point during the year, we haven't given specific timing, there's a lot of factors as we're ramping and scaling the business, but we believe that with the.
Speaker Change: With more black wells coming online it does as Robin said, you know, we're starting to tap to pre sell some of the backlogs, we believe that that helped drive better.
Speaker Change: Revenue and.
Speaker Change: Margin growth for the business.
Speaker Change: Okay. Thank you Dale.
Speaker Change: Denver, where there was a specific question.
Speaker Change: In the press release earlier, we'd referenced that in Q4, we had some churn with some with some of our clients and the question is just if we can provide any more color around that and Daniel paths that can come to you on that.
Daniel: Sure Yes.
Daniel: Yes, so I think that there's a we should expect a certain amount of churn in a market such as the air market.
Daniel: Period.
Daniel: That's baked into our plans and and in some ways highlights. The fact that one of the things that makes us unique as is the range of customers that we serve from from the <unk>.
Daniel: Single single instances of influence with our AI studio to self service to large large implementations like I mentioned earlier thousands of Gpus at a time to bare metal, it's a very wide range and so as we look at the lower end, we expect churn to be a part of the number a great example of.
Daniel: That was you know as deep seek hit the news waves our demand for H, two hundreds really skyrocketed.
Daniel: And and we expect more of that in this market and so there's there's definitely one element of seeing churn across the broad spectrum of our offering. The other is as we exited 24 and into 25 there are a lot.
Daniel: The learnings and in terms of how we service our customers and perfect our AI platform.
Daniel: Platform and so as we do that there there were things that we picked up things that we experienced with our customers and expect to solve those going into and extending into 'twenty five.
Speaker Change: That's great. Thank you very much Daniel.
Speaker Change: I. So once again, we at the beginning of the call. We introduced Neil Doshi, who we are very pleased joined us as our head of Investor Relations. She is based in San Francisco.
Speaker Change: And I say.
Speaker Change: Neil and trying different kind of question for you.
Speaker Change: Question is if you can update of where we are intense that sell side analyst coverage and just maybe more generally as we're putting together the IR calendar, how we're thinking about high after they're coming for the coming year. Yeah. Thanks, Tom. So we are building out the IR plan for 2025 and in terms of sell side coverage today.
Speaker Change: Today, we don't have really any covering analysts.
Speaker Change: As we you know as everyone knows we did not have the luxury of an IPO. So we were one of the few companies that have the market cap that we do with the zero.
Speaker Change: Brokerage.
Speaker Change: Our broker focused at analyst coverage. So this is really a priority for us we would like to have several analysts from broker dealers and research firms that pick up coverage of our stock and we started has some good conversations with many of those analysts and then we'll continue to engage with them.
Speaker Change: Also we will be attending investor conferences this year.
Speaker Change: We really want to elevate NAV, yes in terms of brand and recognition from the investment community and so.
For example, our cadre will actually be speaking at the Goldman Sachs disruptive technology Symposium in London in March and then you'll be doing a fireside chat there.
Speaker Change: And then finally, we'll.
Speaker Change: Consider hosting analysts and investors at industry conferences, and maybe even do a tour of one of our data centers, but more on that to come but overall, we're excited to build a plan and work with both our institutional and retail investors.
Neil Doshi: Great. Thank you Neil.
Neil Doshi: So we have a question about a Dutch tax liability or just to just to recap to remind people what that's what that's referring to.
Neil Doshi: We had said on the previous call that there was a potential that tax payment that would be made that would be probably on the upper end at $400 million.
Neil Doshi: But that we were in discussion with the Dutch tax authorities, she potentially tip kit.
Neil Doshi: To bring that down and to read the reason for the variable with because it would depend on how the shares that we received as part of the consideration for the divestment of how we would use them and how they would be treated sell.
Neil Doshi: Through the shares issued in the pipe transaction that we announced at the end of last year, what we had in video <unk> and others coming into the capital structure, we were able to utilize part of the treasury shares and that already reduced some of the potential obligation on that front.
Neil Doshi: Any of it we're happy to say that actually in February we submitted thereby filings and paid taxes amounting to $180 million to the authorities to settle the remaining potential liability.
Neil Doshi: This isn't a completely done yet, but we're actually reasonably confident that one a T will end up being the amounts.
Neil Doshi: Which would mean that from the 400 that we had previously guided around them that would free up $220 million to put into our expansion plans. So as I say, it's not 100% done that way, where we're reasonably confident that that's the way things are going to wind up.
Phil Com: Okay Phil.
Hey, Thank you very much said to everyone that for her.
Phil Com: For having joined US on the call. It's only our second quarterly results call. Since we became NAV, yet, but we're looking forward to many more and maybe just before we close all I'll turn the floor back to Ekati Sir.
Phil Com: To wrap up.
Phil Com: I think so.
Phil Com: Again.
The company actually didn't agree some months ago and look where we are today.
Phil Com: We are public on NASDAQ we.
Phil Com: Or is the profile of low investors, we had this pipe we.
Phil Com: So we started building our infrastructure, we now have hundreds of megawatts of Datacenters guarantee at this year and with huge plans going forward.
Phil Com: We.
Phil Com: Deployed the first so tens of thousands of Gpus and waiting for the next generation was more tens of thousand Gpus deployed which will be deployed this year.
Phil Com: We.
Phil Com: Completely relaunched Oh.
Phil Com: Oh, Wow platform and interesting as a service platform as well, we now have hundreds of customers quickly growing will be thousands of customers there.
Phil Com: And we.
Phil Com: We believe that we are going to have a little.
Phil Com: Peak a.
Phil Com: Contacts are going forward on this new generation of black walls.
Phil Com: So.
Phil Com: Our other businesses are growing well as well and a lot of going on there. So all in all the group.
Phil Com: Which didn't exist again.
Phil Com: So numerous other months ago goes very well and we're.
Phil Com: We're going forwards.
Phil Com: Looking forward into great results this year.
Phil Com: Thank you I've got a I can certainly confirm it's been a busy time and at the same time, we're just getting going so I. Thank you very much to everyone for joining us good afternoon morning, and all of that in the evening and we'll look forward to seeing it there following up with many of you over the coming periods and otherwise.
Phil Com: Thanks again, the Intouch. Thank you.
Phil Com: Yeah.
Phil Com: Goodbye.