Morgan Stanley Reiterates 'Overweight' Rating for VNET Group Inc. (NASDAQ: VNET) Amid Strong Q1 and AI-Driven Growth

• Morgan Stanley maintains an "Overweight" rating for VNET Group Inc., signaling confidence in its market performance and future prospects.
• VNET Group Inc. reported robust Q1 2026 results, with significant increases in total net revenues and Adjusted EBITDA, primarily driven by its rapidly expanding wholesale business.
• The company's growth trajectory is further bolstered by new large-scale orders, particularly in the artificial intelligence sector, and a recent strategic investment, reflecting strong market and investor confidence in its data center services.

On May 26, 2026, analyst firm Morgan Stanley confirmed its "Overweight" rating for VNET Group Inc. (NASDAQ: VNET). An Overweight rating suggests that the analyst believes the stock will perform better than others in its sector. VNET operates as a carrier- and cloud-neutral internet data center services provider in China, offering hosting and related services.

This positive outlook is supported by VNET's strong first-quarter 2026 results. Total net revenues for the quarter increased by 19.8% year-over-year to RMB 2.69 billion. Adjusted EBITDA, a measure of a company's operational profitability before certain non-cash expenses, also rose by 30.6% to RMB 891.5 million, as highlighted by MarketBeat.

A key driver for this performance is the rapid growth of VNET's wholesale business. As highlighted by PR Newswire, wholesale revenue grew 58.1% to RMB 1.06 billion, becoming the company's largest revenue source for the first time. Management credits this success to the execution of its "dual-core strategy" and strong demand in the China internet infrastructure market.

The company's growth is further fueled by new large-scale orders, particularly related to artificial intelligence. VNET has secured 517MW in new orders so far this year. This includes a significant 510MW order from a major internet customer for its data centers in the Greater Beijing Area, showing strong market confidence in its AI infrastructure capabilities.

This confidence is also reflected in a new strategic investment. As announced by PR Newswire, investors are purchasing a large block of shares at a price equivalent to $8.69 per ADS. At the time of the rating, VNET's stock price was $9.92, above the investment price.