WhiteFiber, Inc.: Interesting AI Infrastructure Play; Initiate at Equal Weight

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WhiteFiber, Inc.: Interesting AI Infrastructure Play; Initiate at Equal Weight

Barclays | WhiteFiber, Inc.

• Beneficiary of the Booming AI Opportunity: The GenAI market is expected to be >$1.3

trillion by 2032, according to Bloomberg Intelligence, driven by increasing enterprise and

hyperscaler demand for compute capacity. WhiteFiber is exposed to this market with

experience in HPC and workloads using significant power density, and added to its

knowledge in data center operations and colocation services with its Enovum acquisition,

enabling it to support heavy-load AI training and inferencing. Within the software and AI

stack, WhiteFiber functions in the foundational infrastructure layers, which we view as critical

bottlenecks in scaling GenAI applications at this time. Additionally, WhiteFiber's retrofitting

strategy enables it to bring capacity online in a faster and less costly way, creating an

advantage over its peers.

• Healthy Segment Growth but Limited Visibility in the Mix: WhiteFiber's two business

segments are both growing strongly (50% y/y growth for cloud in FY25 and 500%+ for

colocation on a small base), and its biggest data center projects have been steadily moving

from construction to initial capacity delivery. However, we note that we need to wait for more

visibility for the longer-term mix between colocation services and cloud revenue streams,

given the company had been putting efforts into colocation, but also demonstrated

aggressive pursuit of cloud compute in the most recent quarter. The ultimate balance

between the segments will have implications for both top line (higher monetization for

Cloud) and profitability (lower CapEx for colocation) over time.

• Still in the Early Innings To Fully Capture This Opportunity: WhiteFiber's top-line growth