Nebius Reports Q4 Results, Stock Declines Despite EPS Beat
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2 days ago
0mins
Should l Buy NBIS?
Source: Benzinga
- Financial Highlights: Nebius reported an adjusted loss of $0.68 per share for Q4, beating the consensus estimate of a $1.14 loss, although revenue of $227.7 million fell short of the expected $246.04 million, indicating challenges in revenue growth despite positive EPS performance.
- Core Business Growth: The core AI cloud revenue surged over 800% year-over-year, accounting for approximately 94% of total revenue, demonstrating that demand in this sector exceeded the company's capacity, reflecting strong market interest in AI solutions despite overall revenue misses.
- First Positive EBITDA: The adjusted EBITDA for Q4 reached $15 million, marking the first quarter of positive EBITDA at the group level, with the core AI cloud business generating $51.8 million in EBITDA at a 24% margin, indicating significant improvements in business profitability.
- Future Outlook: Nebius anticipates annualized run-rate revenue of $7 billion to $9 billion by the end of 2026, having surpassed its 100 megawatt active power target, and expects to secure over 3 gigawatts of contracted power by 2026, showcasing strong potential for capacity expansion and market share growth.
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Analyst Views on NBIS
Wall Street analysts forecast NBIS stock price to rise
5 Analyst Rating
5 Buy
0 Hold
0 Sell
Strong Buy
Current: 89.730
Low
130.00
Averages
164.20
High
211.00
Current: 89.730
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.
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Business Growth Context: The company experienced significant revenue growth of 55% sequentially and nearly 550% year-over-year, indicating strong business expansion despite the earnings shortfall.
Future Outlook and Expansion Plans: Analysts remain cautiously optimistic about Nebius's future, highlighting aggressive expansion plans, including a new data center in France, which is expected to bolster long-term growth.
Market Sentiment and Investment Recommendations: Market reactions were mixed post-earnings, with some analysts raising price targets and suggesting that Nebius stock may continue to face challenges until new catalysts emerge.
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- Data Center Expansion Plans: Nebius plans to achieve over 3 gigawatts of contracted compute capacity by the end of 2026, exceeding prior guidance, indicating robust demand for AI computing capabilities that could drive future revenue growth.
- Positive Market Reaction: Despite Nebius's stock price having tripled last year, it still rose by 8.2% today, demonstrating investor confidence in the company's growth potential, with a market capitalization of approximately $25 billion.
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- Nvidia Earnings Outlook: Nvidia is projected to report record revenue of $57 billion for Q3 of fiscal 2026, with $51.2 billion coming from its data center segment, indicating strong demand for its Blackwell GPUs and suggesting robust growth potential for the company.
- TSMC's Market Position: As a leading chip manufacturer, TSMC produced over 11,800 products in 2024, with 63% of its shipments in Q4 2025 being 3nm or 5nm chips, highlighting its leadership in efficient chip manufacturing.
- Nebius Expansion Plans: Nebius Group aims to increase its data center connected power from 220 megawatts to between 800 megawatts and 1 gigawatt by the end of 2026, backed by contracts worth up to $19.4 billion with Microsoft and $3 billion with Meta, indicating rapid expansion and strong demand in the AI cloud platform market.
See More
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- Improved Cost Control: The cost of revenue rose to $68.5 million in Q4 from $21.1 million a year ago, yet the cost as a percentage of revenue decreased from 60% to 30%, indicating substantial progress in operational efficiency.
- Profitability Recovery: The company achieved positive adjusted EBITDA of $15 million in Q4, a significant turnaround from a $63.9 million loss a year earlier, driven by strong performance in its core AI cloud segment.
- Market Sentiment Shift: Despite Nebius's stock trading over 5% lower post-earnings announcement, retail sentiment on Stocktwits shifted to 'extremely bullish', with message volume surging 80% in 24 hours, reflecting investor confidence in the company's long-term prospects.
See More
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Earnings Report Overview: Nebius shares fell after the release of its Q4 2025 earnings, which missed both top and bottom line forecasts, despite reporting robust revenue growth driven by a shift to AI cloud services.
Business Growth Context: The company experienced significant revenue growth of 55% sequentially and nearly 550% year-over-year, indicating strong business expansion despite the earnings shortfall.
Future Outlook and Expansion Plans: Analysts remain cautiously optimistic about Nebius's future, highlighting aggressive expansion plans, including a new data center in France, which is expected to bolster long-term growth.
Market Sentiment and Investment Recommendations: Market reactions were mixed post-earnings, with some analysts raising price targets and suggesting that Nebius stock may continue to face challenges until new catalysts emerge.
See More
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- Revenue Growth Exceeds Expectations: Nebius Group's annual revenue run rate target of $1.1 billion for the end of 2025 was surpassed, achieving $1.25 billion, showcasing the company's strong performance in the AI cloud infrastructure sector and solidifying its market position.
- Optimistic Future Outlook: The company anticipates a sevenfold increase in its revenue run rate for 2026, reflecting confidence in market demand, particularly amid surging needs for AI computing capacity, which may attract more investor interest.
- Data Center Expansion Plans: Nebius plans to achieve over 3 gigawatts of contracted compute capacity by the end of 2026, exceeding prior guidance, indicating robust demand for AI computing capabilities that could drive future revenue growth.
- Positive Market Reaction: Despite Nebius's stock price having tripled last year, it still rose by 8.2% today, demonstrating investor confidence in the company's growth potential, with a market capitalization of approximately $25 billion.
See More
Nebius Expects Sevenfold Revenue Growth by 2026
- Revenue Growth Expectations: Nebius achieved an annual revenue run rate of $1.25 billion by the end of 2025, surpassing the previous guidance of $1.1 billion, indicating strong performance in the AI cloud infrastructure sector, with expectations for a sevenfold increase in 2026 further solidifying its market position.
- Data Center Expansion Plans: The company plans to increase its compute capacity to over 3 gigawatts (GW) by the end of 2026 to meet the surging demand for AI computing, a strategy that will drive future revenue growth and enhance competitive advantages.
- Stock Price Reaction: Nebius's stock price has more than tripled over the past year, and despite a recent pullback, it currently holds a market cap of approximately $25 billion, reflecting positive market expectations for its future growth, with investors needing to monitor demand sustainability into 2027.
- Investment Advice: Despite Nebius's impressive performance, it was not included in Motley Fool's current list of top investment stocks, suggesting that investors should carefully assess market dynamics and the company's outlook before making investment decisions.
See More
Surge in AI Stock Investments Amid $650 Billion Spending Plans
- Market Investment Trend: Microsoft, Alphabet, Amazon, and Meta are set to invest up to $650 billion in AI in 2023, and while their stocks have dipped slightly, investors should focus on AI infrastructure companies that are expected to benefit significantly from this trend.
- Nvidia Earnings Expectations: Nvidia (NVDA) is anticipated to report quarterly earnings on February 25, with expectations of a substantial revenue increase following last year's record revenue of $57 billion, of which $51.2 billion came from its data center segment, indicating strong market demand.
- TSMC's Market Position: Taiwan Semiconductor Manufacturing (TSM) is the preferred foundry for top chipmakers, producing over 11,800 products in 2024, with 63% of its shipments in Q4 2025 being 3nm or 5nm chips, showcasing its leadership in efficient chip manufacturing.
- Nebius Group Expansion Plans: Nebius Group (NBIS) aims to increase its data center connected power from 220 megawatts to between 800 megawatts and 1 gigawatt by the end of 2026, backed by contracts worth up to $19.4 billion with Microsoft and $3 billion with Meta, highlighting its rapid growth potential in AI cloud platform development.
See More
Top Picks for Investing in Chipmakers
- AI Investment Surge: Microsoft, Alphabet, Amazon, and Meta are set to invest up to $650 billion in AI this year, creating significant demand for related infrastructure companies, particularly chipmakers like Nvidia and TSMC, which are expected to benefit from this trend.
- Nvidia Earnings Outlook: Nvidia is projected to report record revenue of $57 billion for Q3 of fiscal 2026, with $51.2 billion coming from its data center segment, indicating strong demand for its Blackwell GPUs and suggesting robust growth potential for the company.
- TSMC's Market Position: As a leading chip manufacturer, TSMC produced over 11,800 products in 2024, with 63% of its shipments in Q4 2025 being 3nm or 5nm chips, highlighting its leadership in efficient chip manufacturing.
- Nebius Expansion Plans: Nebius Group aims to increase its data center connected power from 220 megawatts to between 800 megawatts and 1 gigawatt by the end of 2026, backed by contracts worth up to $19.4 billion with Microsoft and $3 billion with Meta, indicating rapid expansion and strong demand in the AI cloud platform market.
See More
Nebius Reports Strong Q4 Earnings Amid Revenue Growth
- Significant Revenue Growth: Nebius reported Q4 revenue of $227.7 million, a remarkable 547% year-on-year increase, although it fell short of analysts' expectations of $242.79 million, highlighting both challenges and opportunities in the company's rapid expansion.
- Improved Cost Control: The cost of revenue rose to $68.5 million in Q4 from $21.1 million a year ago, yet the cost as a percentage of revenue decreased from 60% to 30%, indicating substantial progress in operational efficiency.
- Profitability Recovery: The company achieved positive adjusted EBITDA of $15 million in Q4, a significant turnaround from a $63.9 million loss a year earlier, driven by strong performance in its core AI cloud segment.
- Market Sentiment Shift: Despite Nebius's stock trading over 5% lower post-earnings announcement, retail sentiment on Stocktwits shifted to 'extremely bullish', with message volume surging 80% in 24 hours, reflecting investor confidence in the company's long-term prospects.
See More
