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Nebius (NBIS) secured a $3B five-year contract with Meta and a $17.4B deal with Microsoft for AI infrastructure.
Nebius’ core AI revenues grew 400% year-over-year and 40% quarter-over-quarter with sold-out capacity.
Nebius targets 2.5 gigawatts of contracted capacity by late 2026 and $8B in annual recurring revenue.
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Nebius Group (NASDAQ:NBIS) was pulled out of obscurity earlier this year when Nvidia (NASDAQ:NVDA) revealed its hidden investment portfolio had taken a stake in the AI data center stock. It participated in a $700 million private placement last December and today owns nearly 1.2 million shares valued at about $112 million at current prices. It has quickly become a pivotal force in the AI infrastructure landscape, capitalizing on the explosive need for GPU-intensive processing.
This focus has driven remarkable growth, with core AI revenues soaring approximately 400% year-over-year and 40% quarter-over-quarter in the latest period. The stock surged to record highs last month, reflecting investor enthusiasm for its positioning in the booming AI sector.
Yet, shares have since plummeted 33% from that peak, including a sharp 20% decline over the past week. The downturn traces back to third-quarter earnings that fell short of revenue expectations, raising flags about near-term margins strained by aggressive investments in expansion. Despite this, deeper indicators reveal resilience and untapped potential that savvy investors should not overlook.
In the race to dominate AI, energy supply emerges as the primary limiting factor, far more than chip availability. Microsoft (NASDAQ:MSFT) CEO Satya Nadella recently said, “compute is not the bottleneck, but energy and data center space is.”
Each additional unit of electricity directly correlates to the number of high-performance accelerators a…
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