Nebius Group
NBIS · NASDAQAI Cloud Infrastructure · Data Center
Since the Report − 16.3%
Close on Report DayAug 12
$259.20▲ 34.1%Report-Day Move
- Market Cap(Today)
- ≈ $55.1 B
- 1Y Return(At Report)
- + 244%
Nebius grew quarterly revenue 454% year over year to $582 million, swung adjusted EBITDA firmly positive for the first time, and lifted its annualized run-rate revenue (ARR) to $3 billion. Four new AI cloud contracts each worth more than $1 billion, plus a raised year-end contracted-power target of 5 GW, sent the stock up roughly 34% on earnings day. The key thing to watch now is whether the company can keep funding its enormous capital spending with customer prepayments through to 2027, when those mega-deals begin converting into revenue.
Revenue (Q2)
$582.3M
▲ 454% YoY
AI Cloud Revenue
$575M
▲ 514% YoY
Annualized Run-Rate (ARR)
$3.0B
▲ 56% QoQ
Adjusted EBITDA
$236.2M
Margin 40.6% · AI Cloud 50%
Adjusted EPS
−$0.12
Loss Narrowed 64% YoY
GAAP Net Loss
−$190.4M
Widened with Capex Ramp
Quarterly Revenue ($ Million)
105
146
228
399
582
≈850–950
- Q2 25
- Q3 25
- Q4 25
- Q1 26
- Q2 26
- Q3 26E
- Revenue Growth YoY
- ▲ 454%From $105M in Q2 25
- AI Cloud Share
- 98%$575M Revenue
- Annualized Run-Rate
- $3.0B▲ 56% QoQ
Q3 2026 Company Guidance
- Full-Year Revenue3.0 – 3.4 billion
Midpoint $3.2B · All MetricsReaffirmed ✓
- Year-End ARR7 – 9 billion
From $3.0B at End of Q2Reaffirmed ▲
- Contracted Power5 GW
Was 4 GW+ in MayRevised Up ▲
The blue band is the company's low–high range; its length shows how much room the company left itself. The black triangle and the line beneath it mark where the market expected, and the notch in the band is the range's midpoint. The triangle appears only where a market expectation is known. Axis is ±14% around the midpoint.
- Customer Prepayments
- $9B+Expected in 2026
- Cash Position
- $8.04BJune 30, 2026
- Quarterly Capex
- $5.66BQ2 Capacity Investment
“Demand for AI capacity continues to grow exponentially, and we are converting that demand into contracted, profitable growth.”
- Demand Growing Exponentially
- Four $1 Billion Contracts
- Cloud EBITDA Margin 50%
Summary
Nebius reported $582.3 million in revenue for the second quarter of 2026, a 454% jump from $105 million a year earlier. Almost all of it (about 98%) came from AI cloud services, a segment that alone grew 514% year over year. The company's annualized run-rate revenue (ARR) reached $3 billion at quarter-end, up 56% from the prior quarter. Adjusted EBITDA rose to $236 million for a 40.6% margin, climbing to 50% within the AI cloud business itself. During the quarter Nebius signed four new cloud contracts each exceeding $1 billion, raised its year-end contracted-power target to 5 GW, and kept its cash position above $8 billion.
The stock reacted strongly to the results: after opening roughly 15% higher pre-market, NBIS built on that momentum through the session to close up about 34% at $259.20. What excited investors was less this quarter's figures and more the signals about the future: four mega-deals, demand outstripping supply, and management's comment that 2027 capacity could be sold out today. Founder and CEO Arkady Volozh stressed that the company is deliberately holding back capacity for shorter, higher-priced contracts. That said, the rally pushed the stock right up to the analysts' average price target of roughly $263, leaving little near-term upside against current targets. On the other hand, most of those targets predate the report and analysts began revising them higher right after the results.
Our overall view is that this was an almost flawless quarter operationally: revenue, ARR, margins and contract backlog all beat expectations together, and the company backed its path to profitable growth with concrete contracts. Still, Nebius remains unprofitable on a GAAP basis; net loss widened to $190 million this quarter and quarterly capex reached $5.7 billion. The fact that this enormous investment is largely funded by customer prepayments (more than $9 billion expected in 2026) and $8 billion in cash softens the risk, but rising share count and capital intensity should not be ignored. Because the quarter's scorecard is strong our assessment is positive; even so, this is a score for how good the reported quarter was, not a recommendation to buy the stock at the current price.
Full Review
ClaudeAI cloud services are the revenue engine.
About 98% of quarterly revenue, or $575 million, came directly from Nebius's AI cloud services, and that segment grew 514% year over year. A year ago total revenue was just $105 million; the company more than quintupled that base, showing it is one of the fastest-growing 'neocloud' players in the sector. The driver is insatiable demand for GPU-based compute and Nebius's ability to bring that capacity online quickly. Revenue also rose 46% sequentially versus the prior quarter, a sign that the growth is durable momentum rather than a one-off. The main question is no longer whether demand exists, but how fast the company can build the power, data-center and chip capacity to meet it.
ARR and four mega-deals point to the future.
Perhaps the single most important figure of the quarter was annualized run-rate revenue (ARR) reaching $3 billion and rising 56% from the prior quarter; it is a snapshot of how much revenue existing contracts generate on an annual basis. The company also disclosed four separate AI cloud contracts each exceeding $1 billion, with the bulk of their revenue contribution landing in 2027. Management said these deals carry yields of $20-25 million per megawatt and, thanks to customer prepayments, cut payback periods to under two years. Nebius reaffirmed its year-end 2026 ARR target of $7-9 billion, meaning the current $3 billion level is expected to more than double by year-end. This shows the company's visibility rests on a contracted revenue base spread over years, not just a single quarter.
EBITDA turned positive but GAAP loss and burn persist.
Adjusted EBITDA swung from a $21 million loss a year ago to $236 million positive this quarter, reaching a 40.6% total margin and 50% within the AI cloud business; concrete proof that unit economics improve as scale grows. On the other side of the picture, however, GAAP net loss widened to $190 million this quarter and quarterly capex reached $5.7 billion. The gap between the two stems from heavy depreciation, interest and capacity build-out costs. The 64% year-over-year narrowing of adjusted net loss is an encouraging signal, but the company has not yet reached net profitability. The balance investors must track is how quickly rising margins can offset the capital intensity.
Valuation caught up to targets after the rally.
After the 34% jump on earnings day, NBIS rose to $259 and settled just below the analysts' average price target of roughly $263, pushing upside against current targets to nearly zero. There are two readings of this. On one hand, the market appears to have already priced in the strong quarter and the 2027 outlook. On the other, most of those targets were set before the report, and analysts began raising their estimates immediately after the results, so the 'zero upside' picture could change within a few weeks. The stock has gained about 244% over the past twelve months, meaning expectations are already high. What carries the story from here will be whether ARR genuinely progresses toward the $7-9 billion target.
Strengths
6- Revenue grew 454% YoY and 46% sequentially; momentum is strong.
- ARR reached $3 billion and rose 56% quarter over quarter.
- Adjusted EBITDA is meaningfully positive for the first time; AI cloud margin 50%.
- Four new contracts each above $1 billion secure future revenue.
- $8 billion in cash and $9B+ in expected prepayments support funding.
- Contracted-power target raised to 5 GW for year-end.
Risks
6- GAAP net loss widened to $190 million; net profitability is still distant.
- Quarterly capex of $5.7 billion; capital intensity is very high.
- Share count is rising to fund growth, creating dilution risk.
- Post-rally price sits at the analysts' average target; near-term upside is limited.
- Mega-deal revenue mainly arrives in 2027; execution and timing risk remain.
- Delays in chip, power or data-center supply could disrupt the capacity plan.
What to Watch
4- Q3 2026 results are due around November 2026.
- Tracking the $7-9 billion year-end ARR and 5 GW contracted-power targets.
- The four $1 billion contracts beginning to flow into 2027 revenue.
- Analysts' post-earnings price-target revisions.
Upcoming Earnings
To Understand This