Stock in Focus: Firmus

AI Adoption has reached a tipping point and continues to accelerate

Who are they and what do they do?

​Firmus is an ‘AI factory operator’ with a geographic presence in Singapore, and shortly, Australia. The company sells computational output in the form of Artificial Intelligence (‘AI’) tokens generated from clusters of GPUs (…otherwise known as ‘chips’) that it owns. As AI has progressed through the adoption curve to the point where it is now a profitable enterprise, demand for computational power has exploded driving an enormous pipeline of opportunity for Firmus. Firmus is currently held as a pre-IPO investment but is aiming to list on the ASX in early 2026.

What are our three key drivers for the company?

1. Demand: AI has hit an inflection point, punctuated by NVIDIA announcing that it has now become a profitable industry for those purchasing tokens. This is driving an explosion in demand, with supply unable to keep up. The US is the largest AI token market in the world and is sold out of capacity with multi-year wait periods. Due to the location independence of the AI market, Australia’s close national security ties with the US, and the presence of most major AI consumers in Australia already, Australia is seen as a highly attractive market to capture overflow demand from the US. Firmus is perfectly placed to capitalise.
2. Pricing: AI token generation is a globally commoditised market due to the location independence of AI training and inference. As such, pricing is a function of supply and demand in the global market. As demand soars and national energy grids and construction pipelines struggle to keep up, AI token pricing should continue to benefit from ongoing tailwinds.
3. Lifecycle Management: The company’s relentless focus on research and development to ensure it is the lowest cost producer will enable it to sweat the chips once they are paid off and continue generating attractive returns on their technology. This will drive highly attractive long-term returns on its capital allocation, as well as allow it to recycle capital into incremental growth rather than asset refreshes.

What do we think the company is worth?

While the closest comparable companies are not yet profitable on a statutory basis, utilising similar operating profit multiples sees our valuation for Firmus at well over 10x its most recent valuation. This is solely based on its near-term pipeline for 150MW of capacity, noting the company’s ambition to build out a pipeline of 1.6GW into 2028.