What Nebius Does And Why Investors Are Watching

Nebius Group N.V. is an Amsterdam-headquartered AI infrastructure company that rents out high-performance computing power for training and running artificial intelligence models. The current company emerged in 2024 after the former Yandex N.V. completed the sale of its Russian businesses and rebranded as Nebius Group. It began trading on the Nasdaq on October 21, 2024. In the twelve months since, the stock has climbed more than 270% and drawn a strategic investment from Nvidia.

How Nebius makes money from AI cloud infrastructure

Nebius sits in a category the market now calls the neocloud, specialized providers that lease GPU capacity for AI workloads rather than the sprawling platforms run by Amazon, Microsoft and Google. Its primary revenue engine is GPU-as-a-Service, leasing high-end Nvidia chips to developers and enterprises, alongside the cloud platform, developer tooling and the data centers and server racks that house it all.

The group is built around one dominant core business and three smaller ventures. The AI cloud segment now accounts for the overwhelming majority of revenue, which is why the market treats NBIS essentially as a pure-play neocloud stock.

Nebius revenue growth and Q1 2026 results

The defining feature of Nebius today is the speed of its revenue ramp. Group revenue has multiplied roughly seven-fold year over year, driven almost entirely by the AI cloud segment as the company brings new data center capacity online.

First-quarter 2026 revenue was $399 million, up 684% year over year, with the AI cloud segment alone generating $389.7 million, an 841% surge. Just as important, the business flipped decisively into positive operating territory.

The headline GAAP net income of $621 million was primarily driven by a $780.6 million non-cash gain from revaluing the company's ClickHouse stake, not by core operations. Strip that out and the picture is more nuanced. Nebius reached positive adjusted EBITDA for the first time, swinging from a $54 million loss to a $130 million profit, but it remained lossmaking on a pretax basis and its adjusted net loss actually widened to $100.3 million as it spent heavily to scale. The operating model is improving, but the company is not yet profitable.

Nebius customers and the Microsoft and Meta backlog

What underpins the valuation is not this quarter's revenue but the contracted future revenue behind it. Nebius reported remaining performance obligations of $33.59 billion as of March 31, 2026. By mid-2026, after further deals, the company was citing more than $40 billion of total contracted revenue from investment-grade customers such as Microsoft and Meta. That backlog is concentrated in two relationships.

This concentration cuts both ways. It gives Nebius exceptional revenue visibility, but two customers hold the large majority of its contracted future revenue, so a single renegotiation or delayed renewal can move billions in present value, as a July 1 selloff on Meta headlines demonstrated. The customer base is slowly broadening, however. In July 2026 Nebius signed a compute agreement with Reflection AI worth more than $1 billion through 2029, its first large contract outside the two hyperscalers.

Nebius 2026 revenue guidance and ARR forecast

Management's 2026 targets frame the growth investors are paying for. The company expects full-year 2026 revenue of $3.0 to $3.4 billion, and is targeting an annualized run-rate of $7 to $9 billion in ARR by year-end, up from more than $1.2 billion at the end of 2025. In 2025 it exceeded the high end of its $900 million to $1.1 billion ARR guidance.

Hitting that target is fundamentally a capacity question, since Nebius has said the main limit on revenue growth is how quickly it can bring power online. Two figures matter here and are easy to confuse. Contracted power, meaning secured land and grid capacity, now exceeds 3.5 GW, and management has raised its year-end 2026 target to more than 4 GW. Connected power, meaning capacity fully built and running in live data centers, is guided at only about 800 MW to 1 GW by the end of 2026. The company has secured up to 1.2 GW of land and power for a new owned AI factory in Pennsylvania, adding to a 1.2 GW campus in Missouri, and now sources more than 75% of its contracted power from owned infrastructure.

Why Nebius stock is rising in 2026

Nvidia's stake in Nebius explained

In a Schedule 13G filed July 13 and made public on July 20, 2026, Nvidia disclosed a 9.3% passive stake in Nebius, sending shares up sharply on July 21. Importantly, this was not fresh money. Roughly 94.7% of the reported 22.26 million shares came from a pre-funded warrant Nvidia bought back in March at $94.94 per underlying share, with the disclosure triggered by SEC ownership rules rather than a new transaction. Nvidia cannot exercise or sell those shares before September 11, 2026. The move builds on Nvidia's previously announced $2 billion investment and a collaboration on AI infrastructure deployment and factory design.

Nebius asset-light model explained

On July 15 to 16, 2026, Nebius unveiled a partner-backed expansion model. Under it, infrastructure partners fund and own the facilities and hardware while Nebius supplies the architecture, software, sales and ongoing maintenance, potentially through revenue sharing, licensing or dedicated capacity. CEO Arkady Volozh framed it as a flexible way for partners to tap AI growth. Investors were initially wary about the funding math, and the stock fell 13.9% on July 16 to close at $171.77, before recovering. The concern is scale. Planned 2026 capital spending of roughly $17.5 to $22.5 billion after the first quarter runs at about 1.9 to 2.4 times the $9.3 billion of cash Nebius held at the end of March, though Q1 operating cash flow of $2.26 billion, lifted by a $3.2 billion jump in deferred revenue, softens that picture.

Nebius joins the Nasdaq-100

Nebius joined the Nasdaq-100 on June 22, 2026 alongside Astera Labs, CoreWeave, Rocket Lab and Teradyne, which forces index and benchmark funds to buy the stock and adds a mechanical bid. On the product side, it shipped version 3.6 of its AI cloud with stronger security, governance and storage, part of a push to move up the stack from renting GPUs toward a full AI platform, and it added contracted power through a $1.7 billion deal with partner Bloom Energy.

Nebius $775 million debt financing

On July 10, 2026, Nebius's U.S. and Finnish subsidiaries entered a senior secured term loan at SOFR plus 2.5%, maturing October 2030, backed by deployed GPUs and contracted customer cash flows. This matters because it lets Nebius fund expansion with asset-level debt rather than dilutive equity, easing a key investor concern given heavy capital spending. It is the company's first senior secured facility, and management says the backlog supports raising more capital on similar terms.

Nebius analyst ratings and price targets

Wall Street holds a Moderate Buy consensus, based on roughly five Buys and three Holds over the prior three months, with an average price target near $252.86, implying about 44% upside from mid-July levels. Individual targets ranged widely, from Bank of America's $280 Buy to Northland Capital Markets at $410.

Nebius frequently asked questions

What does Nebius Group actually do?

Nebius is an AI infrastructure company. Its core business leases high-performance Nvidia GPU capacity and a full-stack cloud platform to developers and enterprises for training and running AI models. It also owns smaller ventures in autonomous vehicles (Avride) and tech education (TripleTen), plus minority stakes in Toloka and ClickHouse.

Is Nebius the same company as Yandex?

It is the successor entity. The former Yandex N.V. sold its Russian assets in 2024 following sanctions and rebranded the remaining international business as Nebius Group N.V. It is headquartered in Amsterdam and led by Yandex co-founder Arkady Volozh.

How much revenue does Nebius generate?

First-quarter 2026 revenue was $399 million, up 684% year over year. Management guides to $3.0 to $3.4 billion in full-year 2026 revenue and targets a $7 to $9 billion annualized run-rate by year-end 2026.

Why did Nebius stock jump in July 2026?

Nvidia disclosed a 9.3% passive stake on July 21, 2026, sending shares up around 17%. The move followed a $775 million secured debt facility and several analyst upgrades. Most of Nvidia's stake came from a warrant bought in March rather than a new investment.

Who are Nebius's biggest customers?

Microsoft and Meta dominate the contracted backlog. Nebius has a Microsoft deal worth about $17.4 billion (expandable to $19.4 billion) and Meta agreements totaling a roughly $3 billion contract plus an expansion worth up to $27 billion. In July 2026 it added Reflection AI on a compute deal worth more than $1 billion through 2029.

What is Nebius's asset-light model?

Announced in mid-July 2026, it is a partner-backed expansion approach where infrastructure partners fund and own the data centers and hardware, while Nebius provides the architecture, software, sales and maintenance. It is meant to fund rapid growth without heavy balance-sheet spending, though the specific partners and economics have not been fully disclosed.

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