$FLNC DD - If $NVDA is selling shovels, then $FLNC is selling power bars to the laborers using them.

You’ve heard of AI, right? Well, AI needs data centers. And data centers need power... A LOT of power. And data centers don’t use that power evenly. When workloads ramp, power demand can spike instantly, and the power grid isn’t built to handle those swings.

Now that your peanut brain understands that, let me tell you about where Fluence Energy ($FLNC) comes in.

Fluence makes big batteries that act like a bank for the data centers. They store power when power supply is steady and demand is low, then release it when demand spikes. This keeps data centers from overloading the grid, reduces outages, and helps data centers avoid paying peak power costs.

Sounds like a good idea, right? Well, Nvidia ($NVDA) and Siemens ($SIEGY) announced today that they think so too.

Fluence just teamed up with them to create a blueprint for next-gen AI data centers. These are massive facilities designed to run heavy AI workloads. Fluence’s role is to integrate their Smartstack battery storage into those systems so the data centers can handle the power swings.

If AI is going to keep growing at this breakneck pace, it’s going to require a massive buildout of power infrastructure. There’s a lot of focus on chips/software/applications, but data centers can’t run without reliable electricity, and that’s becoming a bottleneck.

Fluence isn’t the flashy part of the trade, but it’s one of the more direct ways to play the “AI needs power” thesis. If Nvidia is selling shovels, then Fluence is selling protein bars to the laborers using them.

As of their recent Q2 ER, they’re guiding toward positive EBITDA for the full year, with expected revenue between $3.2B – $3.6B.

More important though is the fact that they’re sitting on $5.6B backlog, which gives them multiple years of revenue visibility. They’ve already booked about $2B in orders this year, which is double last year’s pace.

Oh, and did I mention that their market cap is still less than $5B even after the 40% gain they saw today after the $NVDA/$SIEGY news release? Or that they likely had about 25% short interest as of end of May? Or that they’re not even at an ATH yet even after the news today?

TLDR: AI want power, Fluence store power to make AI go brr. Me like companies that work with Nvidia.

Positions: 6/18 $25C’s, 6/18 $30C’s, 6/18 $34C’s, 534 shares.