Intensifying Competition in AI Infrastructure
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jun 08 2026
0mins
Source: Fool
- Nebius Group Growth: Nebius Group reported nearly $529.8 million in revenue for FY 2025, reflecting a substantial year-over-year increase of approximately 350%, with a net income of about $101.7 million and a net margin of around 19.2%, indicating strong profitability as it expands its cloud services.
- SoundHound AI Performance: SoundHound AI achieved a revenue growth of nearly 99.4% in FY 2025, reaching approximately $168.9 million, despite a net loss of close to $14.0 million, showing significant improvement in net margin from previous years, highlighting its adaptability in the voice recognition market.
- Risk and Competition Analysis: Nebius Group faces intense competition from larger hyperscalers like Amazon and Microsoft, along with rapid technological changes and complex data sovereignty regulations, while SoundHound AI must navigate the risks of inaccurate AI outputs that could impact its reputation in the automotive and restaurant sectors.
- Valuation Comparison: Nebius Group trades at a forward P/E of 191.6x, significantly higher than the sector benchmark of 16.9x, while SoundHound AI's P/S ratio stands at 18.9x, indicating its relative attractiveness in the market, prompting investors to weigh the long-term potential against current valuations.
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Analyst Views on NBIS
Wall Street analysts forecast NBIS stock price to fall
5 Analyst Rating
5 Buy
0 Hold
0 Sell
Strong Buy
Current: 280.910
Low
130.00
Averages
164.20
High
211.00
Current: 280.910
Low
130.00
Averages
164.20
High
211.00
About NBIS
Nebius Group NV is a Netherlands-based infrastructure company operating in the technology industry. The Company is engaged in developing a portfolio of artificial intelligence-related technology assets. It is involved in creating an artificial intelligence-centric player to integrate the essential elements of artificial intelligence development with infrastructure, data and advisory globally. It offers products and services such as a cloud platform for artificial intelligence-related workloads, development team services for autonomous vehicles, development of generative artificial intelligence. Nebius builds full-stack infrastructure to service the growth of the global AI industry, including GPU clusters, cloud platforms and tools and services for developers. Company is developing three other businesses that operate under their own brands: Toloka AI, TripleTen and Avride.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Nebius Group Stock Surges 1,320% Amid AI Demand
- Stock Performance: Since its debut on October 21, 2024, Nebius Group's stock has surged 1,320%, significantly outperforming the overall market, indicating investor recognition of the critical role data centers and computing capacity play in AI growth.
- Nasdaq-100 Inclusion: Starting June 22, Nebius will be added to the Nasdaq-100 index, which is expected to attract significant investment from index funds, potentially pushing the stock price even higher as it approaches the $300 mark.
- Financial Performance: In Q1 2025, Nebius reported revenue of $399 million, a staggering 684% increase year-over-year, with net income reaching $621.2 million, a substantial turnaround from a loss, showcasing strong business growth potential.
- Strategic Investments and Partnerships: Nebius secured a $2 billion investment from Nvidia and a five-year AI infrastructure deal with Microsoft valued at up to $19.4 billion, which is expected to significantly enhance its market competitiveness and technological capabilities.
See More
Trillion-Dollar Market Cap Club Expands
- Market Expansion: The number of companies with trillion-dollar market caps has grown to about 20, reflecting the significant impact of AI spending on the market; while most companies have limited growth potential, some smaller firms exhibit greater upside.
- Sandisk Performance: Sandisk's stock has surged nearly 800% in 2026, and while another such gain is unlikely, its forward P/E ratio is expected to drop to 11.5 by fiscal 2027, suggesting a potential tripling of stock price if earnings triple as anticipated, indicating strong investment potential.
- Nebius Growth Potential: Nebius's stock has risen 210% in 2026, with projected revenue growth rates of 550% and 225% for 2026 and 2027, respectively, and its focus on AI data centers provides a robust competitive advantage in the market.
- CoreWeave Outlook: Although CoreWeave has underperformed this year with a 50% increase, its rapid expansion to meet demand from AI hyperscalers and a revenue backlog nearing $100 billion signal strong growth potential, with expected revenue growth rates of 147% and 97% for 2026 and 2027, respectively.
See More
Analysis of Future Growth Potential for Three Tech Companies
- Sandisk Stock Performance: Sandisk's stock has surged nearly 800% this year, and while another similar gain is unlikely, the strong demand and rising prices in the NAND storage market for data centers will continue to drive revenue and profit growth, with a projected P/E ratio of only 11.5 for fiscal 2027, indicating significant upside potential.
- Nebius Growth Potential: Nebius's stock has risen 210% this year, with Q1 revenue soaring 684% year-over-year, and projected revenue growth of 550% and 225% for fiscal years 2026 and 2027, respectively, highlighting its strong demand in the AI data center sector, making it a no-brainer buy for investors.
- CoreWeave Revenue Outlook: CoreWeave's stock has increased about 50% this year, and despite a relatively weaker performance, it generated $2.1 billion in revenue in Q1 with a backlog nearing $100 billion, expecting to realize over a third of that in the next two years, showcasing robust growth potential.
- Market Competition Analysis: Although Sandisk, Nebius, and CoreWeave have not yet reached the $1 trillion market cap, they exhibit significant growth potential in the AI-driven market, which could lead to larger market opportunities in the coming years.
See More
Nasdaq-100 Index Welcomes Five New Members
- New Member Introduction: The Nasdaq-100 index will add five companies on June 22, including Astera Labs, CoreWeave, Nebius Group, Teradyne, and Rocket Lab, all of which excel in networking, AI, and computing capacity, with year-to-date gains ranging from 53% to 242%, reflecting strong market demand in these sectors.
- Astera Labs Rapid Growth: Astera Labs focuses on providing high-speed connectivity hardware and software for AI systems, reporting first-quarter revenue of $308.4 million, a 93% increase year-over-year, and net income of $80.3 million, up from $31.8 million last year, indicating robust performance and future growth potential in the AI market.
- CoreWeave's Contract Expansion: CoreWeave has secured contracts with Meta totaling $35 billion, with a revenue backlog nearing $100 billion reported in the first quarter, and it expects to achieve 8 GW of power capacity by 2030, showcasing its strong capabilities in cloud computing and AI workload management.
- Nebius Group's Investment and Expansion: Nebius Group received a $2 billion investment from Nvidia and plans to achieve 4 GW of AI capacity by the end of 2025, exceeding its original target, while its contracts with Microsoft and Meta total $46 billion, underscoring its leadership position in the AI cloud services market.
See More
Nasdaq-100 Index Welcomes Five New Members
- Nasdaq-100 Restructuring: On June 22, the Nasdaq-100 index will add five companies: Astera Labs, CoreWeave, Nebius Group, Teradyne, and Rocket Lab, reflecting strong market demand for networking, AI, and computing infrastructure, which is expected to further boost these companies' market capitalizations.
- Astera Labs Strong Performance: The company reported first-quarter revenue of $308.4 million, a 93% increase year-over-year, with net income rising to $80.3 million from $31.8 million last year, demonstrating its market leadership in AI system connectivity hardware and software.
- CoreWeave Contract Surge: CoreWeave's contracts with Meta have reached a total of $35 billion, with an additional $21 billion commitment for AI computing capacity in 2023, and a first-quarter revenue backlog nearing $100 billion, with expectations to achieve 8 GW of power capacity by 2030.
- Nebius Group Outstanding Performance: As the best-performing stock this year, Nebius has seen a 242% increase in its stock price and secured a $2 billion investment from Nvidia, planning to achieve 4 GW of AI capacity by the end of 2025, exceeding its original target and showcasing its strong growth potential in the AI cloud services market.
See More
Nebius Stock Soars 210% Year-to-Date with Significant Growth Potential
- Stock Performance: Nebius stock has surged 210% year-to-date in 2026, reflecting strong market performance and increasing investor confidence in its future growth potential, indicating further upside ahead.
- Revenue Growth: The company reported a staggering 684% year-over-year revenue increase in Q1, with Wall Street projecting a 550% revenue growth for 2026 and 225% for 2027, potentially elevating its revenue from under $900 million to $11.2 billion.
- Strategic Partnerships: Nebius has secured investment and partnership from Nvidia, enhancing its market credibility and providing robust technical support, underscoring its significance and potential in the AI cloud computing sector.
- Client Base: Nebius has attracted major clients like Microsoft and Meta, who, despite having their own data centers, opt for Nebius's services to meet the rapidly growing AI computing demands, further driving the company's business expansion.
See More
Nebius Group Stock Surges 1,320% Amid AI Demand
- Stock Performance: Since its debut on October 21, 2024, Nebius Group's stock has surged 1,320%, significantly outperforming the overall market, indicating investor recognition of the critical role data centers and computing capacity play in AI growth.
- Nasdaq-100 Inclusion: Starting June 22, Nebius will be added to the Nasdaq-100 index, which is expected to attract significant investment from index funds, potentially pushing the stock price even higher as it approaches the $300 mark.
- Financial Performance: In Q1 2025, Nebius reported revenue of $399 million, a staggering 684% increase year-over-year, with net income reaching $621.2 million, a substantial turnaround from a loss, showcasing strong business growth potential.
- Strategic Investments and Partnerships: Nebius secured a $2 billion investment from Nvidia and a five-year AI infrastructure deal with Microsoft valued at up to $19.4 billion, which is expected to significantly enhance its market competitiveness and technological capabilities.
See More
Trillion-Dollar Market Cap Club Expands
- Market Expansion: The number of companies with trillion-dollar market caps has grown to about 20, reflecting the significant impact of AI spending on the market; while most companies have limited growth potential, some smaller firms exhibit greater upside.
- Sandisk Performance: Sandisk's stock has surged nearly 800% in 2026, and while another such gain is unlikely, its forward P/E ratio is expected to drop to 11.5 by fiscal 2027, suggesting a potential tripling of stock price if earnings triple as anticipated, indicating strong investment potential.
- Nebius Growth Potential: Nebius's stock has risen 210% in 2026, with projected revenue growth rates of 550% and 225% for 2026 and 2027, respectively, and its focus on AI data centers provides a robust competitive advantage in the market.
- CoreWeave Outlook: Although CoreWeave has underperformed this year with a 50% increase, its rapid expansion to meet demand from AI hyperscalers and a revenue backlog nearing $100 billion signal strong growth potential, with expected revenue growth rates of 147% and 97% for 2026 and 2027, respectively.
See More
Analysis of Future Growth Potential for Three Tech Companies
- Sandisk Stock Performance: Sandisk's stock has surged nearly 800% this year, and while another similar gain is unlikely, the strong demand and rising prices in the NAND storage market for data centers will continue to drive revenue and profit growth, with a projected P/E ratio of only 11.5 for fiscal 2027, indicating significant upside potential.
- Nebius Growth Potential: Nebius's stock has risen 210% this year, with Q1 revenue soaring 684% year-over-year, and projected revenue growth of 550% and 225% for fiscal years 2026 and 2027, respectively, highlighting its strong demand in the AI data center sector, making it a no-brainer buy for investors.
- CoreWeave Revenue Outlook: CoreWeave's stock has increased about 50% this year, and despite a relatively weaker performance, it generated $2.1 billion in revenue in Q1 with a backlog nearing $100 billion, expecting to realize over a third of that in the next two years, showcasing robust growth potential.
- Market Competition Analysis: Although Sandisk, Nebius, and CoreWeave have not yet reached the $1 trillion market cap, they exhibit significant growth potential in the AI-driven market, which could lead to larger market opportunities in the coming years.
See More
Nasdaq-100 Index Welcomes Five New Members
- New Member Introduction: The Nasdaq-100 index will add five companies on June 22, including Astera Labs, CoreWeave, Nebius Group, Teradyne, and Rocket Lab, all of which excel in networking, AI, and computing capacity, with year-to-date gains ranging from 53% to 242%, reflecting strong market demand in these sectors.
- Astera Labs Rapid Growth: Astera Labs focuses on providing high-speed connectivity hardware and software for AI systems, reporting first-quarter revenue of $308.4 million, a 93% increase year-over-year, and net income of $80.3 million, up from $31.8 million last year, indicating robust performance and future growth potential in the AI market.
- CoreWeave's Contract Expansion: CoreWeave has secured contracts with Meta totaling $35 billion, with a revenue backlog nearing $100 billion reported in the first quarter, and it expects to achieve 8 GW of power capacity by 2030, showcasing its strong capabilities in cloud computing and AI workload management.
- Nebius Group's Investment and Expansion: Nebius Group received a $2 billion investment from Nvidia and plans to achieve 4 GW of AI capacity by the end of 2025, exceeding its original target, while its contracts with Microsoft and Meta total $46 billion, underscoring its leadership position in the AI cloud services market.
See More
Nasdaq-100 Index Welcomes Five New Members
- Nasdaq-100 Restructuring: On June 22, the Nasdaq-100 index will add five companies: Astera Labs, CoreWeave, Nebius Group, Teradyne, and Rocket Lab, reflecting strong market demand for networking, AI, and computing infrastructure, which is expected to further boost these companies' market capitalizations.
- Astera Labs Strong Performance: The company reported first-quarter revenue of $308.4 million, a 93% increase year-over-year, with net income rising to $80.3 million from $31.8 million last year, demonstrating its market leadership in AI system connectivity hardware and software.
- CoreWeave Contract Surge: CoreWeave's contracts with Meta have reached a total of $35 billion, with an additional $21 billion commitment for AI computing capacity in 2023, and a first-quarter revenue backlog nearing $100 billion, with expectations to achieve 8 GW of power capacity by 2030.
- Nebius Group Outstanding Performance: As the best-performing stock this year, Nebius has seen a 242% increase in its stock price and secured a $2 billion investment from Nvidia, planning to achieve 4 GW of AI capacity by the end of 2025, exceeding its original target and showcasing its strong growth potential in the AI cloud services market.
See More
Nebius Stock Soars 210% Year-to-Date with Significant Growth Potential
- Stock Performance: Nebius stock has surged 210% year-to-date in 2026, reflecting strong market performance and increasing investor confidence in its future growth potential, indicating further upside ahead.
- Revenue Growth: The company reported a staggering 684% year-over-year revenue increase in Q1, with Wall Street projecting a 550% revenue growth for 2026 and 225% for 2027, potentially elevating its revenue from under $900 million to $11.2 billion.
- Strategic Partnerships: Nebius has secured investment and partnership from Nvidia, enhancing its market credibility and providing robust technical support, underscoring its significance and potential in the AI cloud computing sector.
- Client Base: Nebius has attracted major clients like Microsoft and Meta, who, despite having their own data centers, opt for Nebius's services to meet the rapidly growing AI computing demands, further driving the company's business expansion.
See More
