Shares of VNET Group (NASDAQ: VNET) tumbled 5.01% in pre-market trading on Thursday following the release of its second quarter 2025 financial results, which showed a surprising loss and raised concerns about future growth prospects.

The Chinese carrier- and cloud-neutral internet data center services provider reported a net loss of RMB 11.9 million ($1.7 million) for Q2, compared to a net income of RMB 63.7 million in the same period last year. This translated to a loss of RMB 0.01 ($0.001) per diluted share, missing analyst expectations of RMB 0.01 profit per share.

While total net revenues increased by 22.1% year-over-year to RMB 2.43 billion ($339.8 million), slightly beating estimates, investors appeared concerned about the company's future growth trajectory. VNET maintained its full-year 2025 revenue guidance of RMB 9.15-9.35 billion, which some analysts viewed as conservative given the strong first-half performance.

Ju Ma, VNET's Rotating President, commented on the results: "We delivered strong second quarter results thanks to continued effective strategic execution. Our wholesale IDC business continued to grow rapidly, driven by our wholesale data centers' fast move-in pace."

However, the market seems to be focusing on potential headwinds, including concerns about AI chip supply constraints and their potential impact on customer demand. Additionally, the company's net debt to trailing twelve months adjusted EBITDA ratio of 5.3 may be raising questions about its financial leverage.

The pre-market stock plunge suggests investors are reassessing VNET's valuation in light of the unexpected loss and uncertainties surrounding its growth outlook, despite management's optimistic stance on AI-driven opportunities in the data center market.