--- title: "VNET Group’s Earnings Call Signals Robust Growth" type: "News" locale: "en" url: "https://longbridge.com/en/news/296689552.md" description: "VNET Group reported strong Q2 growth, with wholesale capacity surpassing 1 GW and revenue rising 14.2% to RMB 2.78 billion. Adjusted EBITDA increased 25.4%, driven by surging demand for data center capacity. The company secured significant new orders, totaling over 1.2 GW including reservations. Despite margin pressure from utility costs and heavy CapEx requirements, VNET maintains healthy liquidity and manageable leverage. A strategic partnership with CATL aims to develop green AI infrastructure." datetime: "2026-08-23T00:29:27.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/296689552.md) - [en](https://longbridge.com/en/news/296689552.md) - [zh-HK](https://longbridge.com/zh-HK/news/296689552.md) generator: "portal-rs" --- # VNET Group’s Earnings Call Signals Robust Growth VNET Group, Inc. Sponsored ADR ((VNET)) has held its Q2 earnings call. Read on for the main highlights of the call. ### Summer Sale - Claim 70% Off TipRanks - Unlock powerful investing tools with TipRanks Premium to make smarter, more confident investment decisions - Subscribe to TipRanks Smart Investor Newsletter, and discover new investing opportunities with data-backed stock picks VNET Group’s latest earnings call struck an upbeat tone, blending strong growth metrics with a candid discussion of risks. Management highlighted surging demand for wholesale data center capacity, solid revenue and EBITDA expansion, and improved liquidity, while acknowledging margin pressure, heavy CapEx and industry supply constraints that could shape execution over the next few years. ## Surging Orders and Deep Backlog Visibility VNET reported a powerful order intake, securing 347 MW of new capacity in Q2, almost all wholesale, taking year‑to‑date wholesale orders to 862 MW. With reservations at 355 MW, total orders plus reservations now exceed 1.2 GW, giving strong delivery visibility with about 287 MW slated for 2026, 345 MW for 2027 and 230 MW beyond 2028. ## Wholesale Capacity and Utilization Push Past 1 GW The group’s wholesale capacity in service jumped 49.4% year over year to 1,007 MW, crossing the 1 GW mark for the first time. Utilized capacity increased 45.5% to 744 MW, driving a utilization rate of 73.9% overall and an impressive 92.5% on mature capacity, underscoring efficient absorption of new builds. ## Broad-Based Revenue Growth Across Segments Total net revenues climbed 14.2% year over year to RMB 2.78 billion in Q2 2026, with both wholesale and retail operations contributing to the advance. Management framed this growth as evidence that demand is accelerating across its data center portfolio rather than relying on a single product line. ## Wholesale Revenue Emerges as Main Growth Engine Wholesale revenue surged 29.3% year over year to RMB 1.10 billion, now representing 39.8% of total revenue and becoming VNET’s primary growth driver. This shift reflects hyperscale and AI workloads increasingly favoring large‑scale wholesale capacity over smaller, retail deployments. ## Profitability Strengthens with EBITDA Upside Adjusted EBITDA rose 25.4% year over year to RMB 918.3 million, lifting the margin to 33.0% from 30.1% a year earlier. Adjusted net income turned positive at RMB 7.4 million, a marked improvement from last year’s adjusted loss and a key milestone in translating growth into bottom‑line gains. ## Stable Retail Business Supports the Growth Story Retail operations delivered steady performance, with monthly recurring revenue per cabinet rising to RMB 9,799. Retail capacity in service reached 50,081 cabinets, utilization remained stable at 64.5%, and revenues increased 9.1% year over year to RMB 1.05 billion, providing a reliable earnings base. ## Expansive Resource Base and Land Bank VNET’s resource position remains sizable, with total mainland capacity exceeding 3.5 GW and around 500 MW of reserved overseas resources. Wholesale resource capacity now tops 4 GW, up about 1.5 GW quarter on quarter, supported by a land bank capable of backing roughly 1.4 GW, split between 908 MW domestic and 478 MW overseas. ## Healthy Liquidity Bolsters Expansion Plans As of June 30, 2026, cash, restricted cash and short‑term investments stood at RMB 7.21 billion, giving the company a solid liquidity cushion. Net operating cash inflow reached RMB 391.8 million in the first half, or RMB 781.5 million when excluding tax and other one‑off items, supporting ongoing build‑out. ## Leverage Metrics Viewed as Manageable Management described debt levels as prudent, with net debt to LQA adjusted EBITDA at 4.6 and total debt to LQA adjusted EBITDA at 6.4. An adjusted EBITDA‑to‑interest coverage ratio of 5.6 indicates that current earnings comfortably service interest obligations, even as the company invests heavily. ## Strategic Tie-Up with CATL for Green AI Infrastructure VNET announced a strategic cooperation with CATL to develop a three‑layer integrated compute‑energy ecosystem aimed at supporting large‑scale AI infrastructure. The initiative spans gigawatt‑scale compute energy facilities, distributed compute‑energy networks and a zero‑carbon token framework, aligning growth with sustainability. ## Cash Gross Margin Compression and Revenue Timing Issues Not all trends were favorable, as adjusted cash gross margin slipped to 41.8% from 43.6% a year earlier, mainly due to higher utility costs and the absence of a prior one‑off gain. Wholesale IDC revenue also came in slightly below some expectations, with management citing move‑in timing, chip supply and project pacing as temporary drags. ## Heavy CapEx and Customer Concentration Risks CapEx reached RMB 3.55 billion in the first half and is guided at RMB 10–12 billion for 2026, signaling substantial near‑term cash outlays to fund 450–500 MW of deliveries. Q2 bookings were concentrated among a small number of leading customers, including one 345 MW order, prompting management to stress plans to diversify the wholesale client base. ## Debt Maturities, Overseas Caution and Industry Constraints Around 40.8% of total debt is scheduled to mature between 2026 and 2028, tying leverage closely to the current build‑out cycle. Management said overseas projects will be developed cautiously due to higher costs and only against firm orders, and warned that structural constraints in power and chips may keep supply tight until roughly 2028. ## Guidance Underscores Confidence in Growth Trajectory VNET reiterated its 2026 outlook, forecasting total net revenues of RMB 11.5–11.8 billion, up about 15.6%–18.6% year over year, and adjusted EBITDA of RMB 3.55–3.75 billion, up roughly 19.2%–25.9%. Full‑year CapEx of RMB 10–12 billion will support planned deliveries of 450–500 MW in 2026 and a total of 585 MW over the next 12 months, backed by more than 1.2 GW in orders and reservations. The call painted VNET as a company riding a powerful demand wave in data centers while shouldering the capital intensity that comes with it. For investors, the key takeaway is a structurally strong growth and profitability profile, offset by margin pressure, leverage and execution risks that will need close monitoring as the sector’s supply constraints play out. ### Related Stocks - [VNET.US](https://longbridge.com/en/quote/VNET.US.md) - [03750.HK](https://longbridge.com/en/quote/03750.HK.md) - [300750.CN](https://longbridge.com/en/quote/300750.CN.md) - [HCCD.SG](https://longbridge.com/en/quote/HCCD.SG.md) ## Related News & Research - [VNET Group (NASDAQ:VNET) Announces Earnings Results, Misses Expectations By $0.02 EPS](https://longbridge.com/en/news/296220797.md) - [VNET: Wholesale IDC growth and strategic partnerships drive revenue and EBITDA gains despite margin pressure](https://longbridge.com/en/news/296210201.md) - [China's VNET Q2 revenue rises on wholesale growth; signs compute-energy deal with CATL](https://longbridge.com/en/news/296211016.md) - [CATL says core operations carbon neutral by end-2025, supply chain next](https://longbridge.com/en/news/296098189.md) - [Moody's Affirms CATL A3 Issuer Rating, Outlook Revised to Positive](https://longbridge.com/en/news/296605274.md) --- > **Disclaimer: This article is for reference only and does not constitute any investment advice.**