HIVE Digital (HIVE) Strengthens AI Capabilities With $30M Nvidia (NVDA) GPU Purchase

HIVE Digital Technologies has announced that it will invest $30 million in Nvidia GPU Clusters for its location in Quebec. The investment includes 248 H100 GPUs and 508 H200 GPUs. The purpose of the investment is to improve AI computation capabilities and then monetize them to make the best use of the ongoing AI revolution.

Hive Digital Technologies operates in the data center industry and engages in cryptocurrency mining. The aim of the firm is to bridge the gap between the digital currency sector and the traditional capital markets. The company makes a major portion of its revenue from mining and selling cryptocurrencies such as Bitcoin. It targets the cryptocurrency trading market as well as the blockchain technology sector.

The company’s top clients are concentrated in the cryptocurrency sector, mostly utilizing its cryptocurrency mining services and data center services. The company utilizes advanced GPU technology to build data centers for high-performance computing applications. Its data centers are located in Canada, Iceland, and Sweden and mostly utilize renewable energy.

The company is well-placed to grow in the AI and Web 3.0 markets, both of which are expected to boom in the coming years. The investment in Nvidia GPUs intends to lay a solid foundation to catch that boom and convert it into revenue when the right time comes.

The H100 cluster should be operational in a few days and is expected to bring in $15 million annually. The H200 cluster will only arrive later in January and is expected to contribute $20 million to revenue. Once in place, HIVE will be able to better serve its customers and meet the growing AI demand.

HIVE’s high-performance computing already generates over $10 million in revenue but the momentum it is expected to generate with its Nvidia investment forms the basis of our bull thesis and is likely to send the stock much higher.

HIVE is not on our latest list of the 31 Most Popular Stocks Among Hedge Funds. As per our database, 7 hedge fund portfolios held HIVE at the end of the third quarter which was 5 in the previous quarter. While we acknowledge the potential of HIVE as a leading investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as HIVE but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.