A computing device classifies unclassified observations. A first batch of unclassified observation vectors and a first batch of classified observation vectors are selected. A prior regularization error value and a decoder reconstruction error value are computed. A first batch of noise observation vectors is generated. An evidence lower bound (ELBO) value is computed. A gradient of an encoder neural network model is computed, and the ELBO value is updated. A decoder neural network model and an encoder neural network model are updated. The decoder neural network model is trained. The target variable value is determined for each observation vector of the unclassified observation vectors based on an output of the trained decoder neural network model. The target variable value is output.