What Happened?

Shares of digital transformation consultancy Grid Dynamics (NASDAQ: GDYN) jumped 5.2% in the afternoon session after it announced a multi-year strategic collaboration agreement with Amazon Web Services (AWS). The agreement focused on helping enterprise companies adopt and expand their use of generative AI, extending an existing 15-year relationship between the two firms. As part of the deal, Grid Dynamics gained access to the AWS Data Foundations for Generative AI Program. This program was designed to help organizations build the robust and high-quality data infrastructures needed to effectively implement and scale artificial intelligence technologies.

The shares closed the day at $9.72, up 3.4% from previous close.

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What Is The Market Telling Us

Grid Dynamics’s shares are very volatile and have had 23 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 6 days ago when the stock gained 10.2% on the news that investor optimism grew around the need for grid modernization, fueled by surging electricity demand from artificial intelligence (AI) data centers and electric vehicles. The U.S. power grid faced historic stress as aging infrastructure met a surge in global electricity consumption. This increased demand stemmed from the rapid growth of energy-intensive AI technology and data centers, with reports indicating AI queries used up to 40 times more electricity than traditional searches. This created a vital need for smart grids and advanced technologies to ensure energy security and support a low-carbon transition. In response, a green investment boom saw billions flow into clean energy and related sectors. Energy storage emerged as a particularly fast-growing area, reflecting broad investor confidence in the profitability of companies supporting the grid's adaptation to these new power demands.

Grid Dynamics is down 55.8% since the beginning of the year, and at $9.72 per share, it is trading 59.6% below its 52-week high of $24.05 from February 2025. Investors who bought $1,000 worth of Grid Dynamics’s shares 5 years ago would now be looking at an investment worth $823.39.

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