😎 Summer Sale Exclusive - Up to 50% off AI-powered stock picks by InvestingProCLAIM SALE

Databricks is one of the most valuable pre-IPO tech companies: Roth

Published 2024/06/20, 15:56
© Reuters.

Data and AI company Databricks is one of the most valuable pre-IPO tech companies, Roth MKM analysts said in a Thursday note.

At its 11th annual Data + AI Summit last week, Databricks unveiled a series of new products, conducted live demonstrations, and featured talks from prominent AI figures.

The company, which has secured around $4 billion in venture capital funding, is currently valued at an estimated $43 billion post-money, as per Pitchbook data, positioning it among the most valuable pre-IPO tech firms.

According to Roth MKM, the company’s strategy centers on developing a comprehensive AI deployment platform, including Large Language Models (LLMs) and the necessary tools to enable customers to create and deploy their AI applications.

With this approach, Databricks competes with cloud hyperscalers like Amazon’s AWS, Microsoft’s Azure, and Google (NASDAQ:GOOGL) Cloud, aiming to offer a seamless and unified analytics platform tailored for big data and AI tasks.

“While Databricks' direct competitors include companies such as Snowflake (NYSE:SNOW) and Confluent, we believe Databricks' product portfolio seems to be on a collision course with AWS' Bedrock and GCP's Vertex (NASDAQ:VRTX) AI,” analysts at Roth MKM said in a note.

Like Databricks, Amazon (NASDAQ:AMZN)'s strategy with Bedrock involves enterprises applying models to their data rather than transferring data to a specific model provider.

“Cloud Infrastructure for AI models continues to evolve at a rapid pace, and we believe early wins in AI infrastructure could lay the foundation for long-term outperformance vs. peers,” the analysts added.

Although Databrick’s fundamentals demonstrate premium growth at scale, its IPO is unlikely to happen before the second half of 2025, Roth MKM noted.

During the event, Databricks said that over 1,500 companies are now training transformer models on their platform and its GPU usage has increased by 25% month-over-month over the past several months.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.