NBIS, IREN, CRWV, APLD: Retail Traders Shrug Off AI Pullback, Buy The Dip In Neocloud Stocks

• Neocloud stocks have declined as investors worry about rising competition.
• Concerns over high costs, debt levels and heavy spending on data center expansion have added pressure. 
• A Stocktwits Poll showed 65% of retail traders saying they were buying the dip despite broader market caution. 

Retail investors are holding their ground on neocloud stocks as artificial intelligence infrastructure providers face pressure, with traders viewing the selloff as a buying opportunity even as institutional investors pull back on valuation concerns and shifting market dynamics. 

“Neocloud” companies, including Nebius Group (NBIS), CoreWeave (CRWV), Applied Digital (APLD) and IREN (IREN) have lost between 25% and 38% in the past one month. 

Why Neocloud Stocks Are Falling

The cloud infrastructure providers have fallen sharply as investors reacted to rising competition concerns and valuation pressures. Also, Meta Platforms’ (META) plans to rent excess AI computing capacity to enterprises fueled fears that major cloud operators could challenge independent GPU infrastructure providers. 

Since companies like Nebius, CoreWeave, Applied Digital, and IREN rely on building specialized data centers and renting out AI computing power, investors became concerned when a major tech company like Meta showed interest in entering the same market. The possibility of a powerful competitor with deep financial resources challenging these smaller operators triggered a sharp sell-off. 

Ahead of second-quarter (Q2) earnings, investors are paying closer attention to the high costs and debt levels involved in building independent data centers. Companies like CoreWeave face large spending commitments to expand capacity. Any slowdown in demand for third-party AI cloud services could make these financial risks more concerning. 

Retail Traders See Pullback As Buying Opportunity 

A recent Stocktwits Poll drawing 1,400 votes found that sentiment among retail traders remains strongly positive toward “Neocloud” companies. The poll showed that 65% of respondents said they were buying shares during the pullback, highlighting a sharp contrast between retail confidence and broader market caution.

The survey asked traders whether they were buying the decline, holding current positions, waiting for a better entry point, or avoiding the sector. About 15% said they would maintain their existing holdings, while 14% preferred to wait for stocks to dip further before investing. Only 6% said they were avoiding the stocks entirely.

A user said, “Buying the dip. Sometimes Wall Street throws a clearance sale on companies before the story is over. I think the neocloud sector has been repriced, not broken. Time will tell, but I’m adding, not running.” 

Another user said, “$ 1.2 Trillion in AI/HPC Capex estimated for 2027, then $ 1.4 Trillion in AI/HPC Capex in 2028. Per Morgan Stanley. The  Neoclouds are about to launch. It's really not even a question.”

So far this year, CRWV,  IREN, APLD and NBIS stocks have gained between 2% and 131%.  

Also See: Why Did LCID, ORCL, HTZ Stocks Plunge To 52-Week Lows Today?

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