VNET Group Soars 7.68% as AI Infrastructure Investments and $50M Buyback Drive Investor Optimism

VNET Group (NASDAQ: VNET) surged 7.68% intraday on September 22, 2025, reaching its highest level since September 2025, as strategic investments in AI infrastructure and a $50 million share buyback program bolstered investor confidence. The rally reflects growing optimism around the company’s ability to capitalize on surging demand for hyperscale data center capacity and AI-related services.

Q2 2025 revenue grew 22% year-over-year, driven by the Hyperscale 2.0 initiative, which prioritizes expanding AI-specific infrastructure. A 40-megawatt data center order for its Gu’an campus, supporting a major internet company’s operations, reinforced VNET’s positioning in the AI value chain. Analysts at Morgan Stanley and Jefferies upgraded price targets, citing improved EBITDA projections and strong customer adoption rates.

Institutional investors, including Deutsche Bank AG and Vanguard Group, increased stakes in late August, signaling alignment with VNET’s long-term strategy. However, mixed financial results persist: while Q2 revenue exceeded estimates, a $0.06 loss per share highlighted the capital intensity of AI expansion. Management attributed the shortfall to deliberate reinvestment, emphasizing a 2028 revenue forecast of 13.6 billion yuan, reflecting a 16.4% annual growth rate.

Risks remain, including rising capital expenditures and supply chain pressures, which could strain liquidity if demand for AI capacity slows. Despite a $50 million buyback program, analysts caution that profitability hinges on disciplined cost management and sustained demand. Divergent analyst ratings—from “Overweight” to “Sell”—underscore the sector’s volatility, though the AI-driven narrative continues to attract growth-oriented investors navigating near-term uncertainties.