Nebius Group Thrives Amid AI Data Center Boom
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 5 hours ago
0mins
Source: Fool
- Revenue Growth Potential: Nebius achieved an annualized revenue of $1.25 billion in 2025, a 14-fold increase from 2024, with expectations to reach $7 billion to $9 billion by 2026, indicating strong revenue growth potential that may attract more investor interest.
- Contract Signing Advantage: Nebius has secured contracts worth over $46 billion with Meta and Microsoft to provide dedicated AI data center capacity, which not only guarantees future revenue for the next five years but also establishes a solid foundation in a competitive market.
- Software Solutions Expansion: Nebius offers not only hardware but also a software stack that helps customers build AI agents and custom software, with expectations that software revenue will constitute a larger share in the future, further enhancing profit margins, as evidenced by a 32% EBITDA margin in Q1.
- Market Valuation Potential: If Nebius achieves $20.4 billion in revenue by 2028, its market cap could reach $114 billion, showcasing significant growth potential in the AI sector, despite its current market cap of $67 billion, indicating substantial upside ahead.
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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: 264.510
Low
130.00
Averages
164.20
High
211.00
Current: 264.510
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.
Nvidia Invests $2 Billion in Nebius Amid Cloud Demand Surge
- Massive Investment: Nvidia's $2 billion investment in Nebius in March underscores its strong confidence in the cloud computing market, particularly amid surging demand for AI infrastructure, which is expected to further enhance Nebius's market position.
- Stock Surge: Nebius's stock has skyrocketed 1,786% year-to-date, reflecting high investor recognition of its growth potential, especially after Nvidia CEO Jensen Huang praised the company at the Computex conference, leading to a more than 5% increase in premarket trading.
- Optimistic Market Sentiment: Nebius has emerged as a focal point on Stocktwits, with heightened discussions among investors indicating a positive outlook for its future, particularly given its collaborations with notable clients like Cursor, Revolut, and Shopify.
- Potential Catalysts: Speculation about Anthropic potentially seeking cloud services from Nebius is gaining traction, and if confirmed, it could significantly boost Nebius's stock price, especially with the current short interest at 18%, which may trigger a buying frenzy in the near term.
See More
BNP Paribas Initiates Neutral Rating on Nebius with $255 Target
- Coverage Initiation: BNP Paribas has initiated coverage on Dutch AI infrastructure provider Nebius (NBIS) with a Neutral rating and a $255 price target, noting that the recent share price spike limits further upside potential.
- Stock Performance: Nebius shares rose about 4% on Tuesday and have surged over 216% year-to-date, emerging as a favored investment in the AI compute scarcity theme, reflecting strong market demand.
- Execution and Assets: Analysts highlighted Nebius's strong execution, exposure to shorter-duration contracts, and its nearly 25% stake in ClickHouse as strategic monetizable assets that have supported the re-rating.
- Risk Assessment: Despite recent price increases and the mix benefit from newer NVIDIA GPUs, analysts believe Nebius's datacenter model suggests limited upside to management's 2026 ARR outlook, making the near-term risk-reward less compelling.
See More
Nebius Group Thrives Amid AI Data Center Boom
- Revenue Growth Potential: Nebius achieved an annualized revenue of $1.25 billion in 2025, a 14-fold increase from 2024, with expectations to reach $7 billion to $9 billion by 2026, indicating strong revenue growth potential that may attract more investor interest.
- Contract Signing Advantage: Nebius has secured contracts worth over $46 billion with Meta and Microsoft to provide dedicated AI data center capacity, which not only guarantees future revenue for the next five years but also establishes a solid foundation in a competitive market.
- Software Solutions Expansion: Nebius offers not only hardware but also a software stack that helps customers build AI agents and custom software, with expectations that software revenue will constitute a larger share in the future, further enhancing profit margins, as evidenced by a 32% EBITDA margin in Q1.
- Market Valuation Potential: If Nebius achieves $20.4 billion in revenue by 2028, its market cap could reach $114 billion, showcasing significant growth potential in the AI sector, despite its current market cap of $67 billion, indicating substantial upside ahead.
See More
Nebius Anticipates Significant Revenue Growth
- Revenue Growth Outlook: Nebius anticipates its annualized revenue will reach $7 billion to $9 billion by the end of 2026, representing a 540% increase from $1.25 billion at the end of 2025, indicating strong market demand and execution capabilities.
- Contract Backlog Advantage: The company has secured over $46 billion in contracts with Meta and Microsoft to provide dedicated AI data center capacity over the next five years, establishing a solid foundation for revenue growth.
- Software Solutions Enhancement: Nebius's software stack not only enables customers to build AI agents and custom software but is also expected to become a significant part of future revenue, improving its EBITDA margin from a negative 106% last year to 32% in Q1 2026.
- Massive Market Potential: Analysts predict that if Nebius achieves $20.4 billion in revenue by 2028, its market cap could reach $114 billion, showcasing the company's substantial growth potential in the AI infrastructure sector.
See More
Nebius Group Shares Hit Record High Following Nvidia CEO's Praise
- Stock Surge: Shares of Nebius Group rose 14.46% on Monday to $33.41, reaching a record high, reflecting strong market confidence in the company's future growth prospects.
- Industry Recognition: Nvidia CEO Jensen Huang praised Nebius as a 'world-class AI cloud' during his keynote at the COMPUTEX technology show in Taiwan, highlighting its collaborations with notable clients, which further enhances the company's industry standing.
- Strategic Investment: Nvidia invested $2 billion in Nebius in March, forming a strategic partnership aimed at accelerating the development of cloud computing infrastructure to meet the rapidly growing demands of the AI market.
- Investor Interest: The hedge fund Situational Awareness recently acquired over 12.4 million shares of Nebius, currently valued at approximately $3.3 billion, indicating strong interest from institutional investors in Nebius.
See More
Nvidia GTC Taipei Conference Unveils New AI Opportunities
- AI Superchip Launch: At the GTC Taipei Conference, Nvidia unveiled the RTX Spark, an AI superchip developed in collaboration with Microsoft, which combines the Arm-based Grace CPU and Blackwell GPU to deliver a native Windows experience for personal computers, marking a reinvention of computing and potentially enhancing Nvidia's penetration into the PC market.
- Vera CPU Introduction: Nvidia introduced the Vera CPU, a high-performance processor designed for the age of agentic AI, which is 1.8 times faster than legacy x86 processors and is now in full production, with notable customers including Anthropic, OpenAI, and SpaceX, indicating strong market demand and competitive positioning.
- Massive Market Opportunity: The global AI PC market is projected to grow from $58 billion in 2025 to $321 billion by 2035, with Nvidia's Vera CPU opening a new $200 billion total addressable market, and the company expects nearly $20 billion in CPU revenue this year, further solidifying its market leadership.
- Strong Financial Performance: Nvidia reported record revenue of $81.6 billion for Q1 of fiscal 2027, an 85% year-over-year increase, with data center revenue reaching $75 billion, up 92%, and management guiding for a 95% revenue growth in Q2, showcasing the company's robust growth potential and investment appeal.
See More
Nvidia Invests $2 Billion in Nebius Amid Cloud Demand Surge
- Massive Investment: Nvidia's $2 billion investment in Nebius in March underscores its strong confidence in the cloud computing market, particularly amid surging demand for AI infrastructure, which is expected to further enhance Nebius's market position.
- Stock Surge: Nebius's stock has skyrocketed 1,786% year-to-date, reflecting high investor recognition of its growth potential, especially after Nvidia CEO Jensen Huang praised the company at the Computex conference, leading to a more than 5% increase in premarket trading.
- Optimistic Market Sentiment: Nebius has emerged as a focal point on Stocktwits, with heightened discussions among investors indicating a positive outlook for its future, particularly given its collaborations with notable clients like Cursor, Revolut, and Shopify.
- Potential Catalysts: Speculation about Anthropic potentially seeking cloud services from Nebius is gaining traction, and if confirmed, it could significantly boost Nebius's stock price, especially with the current short interest at 18%, which may trigger a buying frenzy in the near term.
See More
BNP Paribas Initiates Neutral Rating on Nebius with $255 Target
- Coverage Initiation: BNP Paribas has initiated coverage on Dutch AI infrastructure provider Nebius (NBIS) with a Neutral rating and a $255 price target, noting that the recent share price spike limits further upside potential.
- Stock Performance: Nebius shares rose about 4% on Tuesday and have surged over 216% year-to-date, emerging as a favored investment in the AI compute scarcity theme, reflecting strong market demand.
- Execution and Assets: Analysts highlighted Nebius's strong execution, exposure to shorter-duration contracts, and its nearly 25% stake in ClickHouse as strategic monetizable assets that have supported the re-rating.
- Risk Assessment: Despite recent price increases and the mix benefit from newer NVIDIA GPUs, analysts believe Nebius's datacenter model suggests limited upside to management's 2026 ARR outlook, making the near-term risk-reward less compelling.
See More
Nebius Group Thrives Amid AI Data Center Boom
- Revenue Growth Potential: Nebius achieved an annualized revenue of $1.25 billion in 2025, a 14-fold increase from 2024, with expectations to reach $7 billion to $9 billion by 2026, indicating strong revenue growth potential that may attract more investor interest.
- Contract Signing Advantage: Nebius has secured contracts worth over $46 billion with Meta and Microsoft to provide dedicated AI data center capacity, which not only guarantees future revenue for the next five years but also establishes a solid foundation in a competitive market.
- Software Solutions Expansion: Nebius offers not only hardware but also a software stack that helps customers build AI agents and custom software, with expectations that software revenue will constitute a larger share in the future, further enhancing profit margins, as evidenced by a 32% EBITDA margin in Q1.
- Market Valuation Potential: If Nebius achieves $20.4 billion in revenue by 2028, its market cap could reach $114 billion, showcasing significant growth potential in the AI sector, despite its current market cap of $67 billion, indicating substantial upside ahead.
See More
Nebius Anticipates Significant Revenue Growth
- Revenue Growth Outlook: Nebius anticipates its annualized revenue will reach $7 billion to $9 billion by the end of 2026, representing a 540% increase from $1.25 billion at the end of 2025, indicating strong market demand and execution capabilities.
- Contract Backlog Advantage: The company has secured over $46 billion in contracts with Meta and Microsoft to provide dedicated AI data center capacity over the next five years, establishing a solid foundation for revenue growth.
- Software Solutions Enhancement: Nebius's software stack not only enables customers to build AI agents and custom software but is also expected to become a significant part of future revenue, improving its EBITDA margin from a negative 106% last year to 32% in Q1 2026.
- Massive Market Potential: Analysts predict that if Nebius achieves $20.4 billion in revenue by 2028, its market cap could reach $114 billion, showcasing the company's substantial growth potential in the AI infrastructure sector.
See More
Nebius Group Shares Hit Record High Following Nvidia CEO's Praise
- Stock Surge: Shares of Nebius Group rose 14.46% on Monday to $33.41, reaching a record high, reflecting strong market confidence in the company's future growth prospects.
- Industry Recognition: Nvidia CEO Jensen Huang praised Nebius as a 'world-class AI cloud' during his keynote at the COMPUTEX technology show in Taiwan, highlighting its collaborations with notable clients, which further enhances the company's industry standing.
- Strategic Investment: Nvidia invested $2 billion in Nebius in March, forming a strategic partnership aimed at accelerating the development of cloud computing infrastructure to meet the rapidly growing demands of the AI market.
- Investor Interest: The hedge fund Situational Awareness recently acquired over 12.4 million shares of Nebius, currently valued at approximately $3.3 billion, indicating strong interest from institutional investors in Nebius.
See More
Nvidia GTC Taipei Conference Unveils New AI Opportunities
- AI Superchip Launch: At the GTC Taipei Conference, Nvidia unveiled the RTX Spark, an AI superchip developed in collaboration with Microsoft, which combines the Arm-based Grace CPU and Blackwell GPU to deliver a native Windows experience for personal computers, marking a reinvention of computing and potentially enhancing Nvidia's penetration into the PC market.
- Vera CPU Introduction: Nvidia introduced the Vera CPU, a high-performance processor designed for the age of agentic AI, which is 1.8 times faster than legacy x86 processors and is now in full production, with notable customers including Anthropic, OpenAI, and SpaceX, indicating strong market demand and competitive positioning.
- Massive Market Opportunity: The global AI PC market is projected to grow from $58 billion in 2025 to $321 billion by 2035, with Nvidia's Vera CPU opening a new $200 billion total addressable market, and the company expects nearly $20 billion in CPU revenue this year, further solidifying its market leadership.
- Strong Financial Performance: Nvidia reported record revenue of $81.6 billion for Q1 of fiscal 2027, an 85% year-over-year increase, with data center revenue reaching $75 billion, up 92%, and management guiding for a 95% revenue growth in Q2, showcasing the company's robust growth potential and investment appeal.
See More
