TLDR
- Nebius Group secured a $3 billion five-year deal with Meta to deliver AI infrastructure, following its $17.4 billion Microsoft contract from September.
- Q3 revenue climbed 355% to $146.1 million but fell short of the $156.5 million estimate, with losses widening to $100.4 million.
- The company raised its contracted power guidance to over 2.5 gigawatts by end of 2026, up from 1 gigawatt previously.
- Capital spending jumped to $955.5 million in Q3 from $172.1 million year-ago as Nebius invests in GPUs and power infrastructure.
- Management projects $7-9 billion in annualized revenue by late 2026, compared to current run rate of $551 million.
Nebius Group announced a $3 billion contract with Meta on Tuesday. The five-year agreement will see the neocloud provider supply AI infrastructure to the tech giant.
The news arrived alongside third-quarter earnings that missed Wall Street targets. Revenue surged 355% year-over-year to $146.1 million. Analysts had expected $156.5 million.
The company recorded a $100.4 million loss for the quarter. That compared to a $39.7 million loss in the same period of 2024.
Shares traded erratically in premarket action following the announcements. The stock has climbed fourfold in 2025, reaching a market cap of $27.61 billion as of Monday’s close.
This marks Nebius’s second major hyperscaler agreement. The firm landed a $17.4 billion deal with Microsoft two months ago.
Demand for the Meta contract exceeded available supply. Nebius said it limited the deal size to match existing capacity on hand.
The company will deploy the required infrastructure over the next 90 days. Nebius sold out all available capacity during the third quarter.
Capacity Expansion Plans Accelerate
CEO Arkady Volozh stated that capacity limitations represent the primary constraint on revenue growth. The Amsterdam-based firm is securing additional sites to support expansion.
Nebius increased its contracted power target to more than 2.5 gigawatts by end of 2026. The prior guidance called for 1 gigawatt.
Connected power is projected to grow four times over in 2026. The company expects this metric to rise from 220 megawatts at year-end 2025 to 800 megawatts-1 gigawatt twelve months later.
Capital expenditures reached $955.5 million in the September quarter. That’s up from $172.1 million a year earlier as the company invests in GPUs, real estate, and electrical infrastructure.
Nebius competes in the neocloud space with firms like CoreWeave. These companies offer hardware and cloud services to businesses developing AI capabilities.
Aggressive Revenue Targets Set
The company aims for $7-9 billion in annualized run-rate revenue by the end of 2026. Current ARR stands at $551 million as of September.
One analyst covering the stock projects Q4 2026 ARR at $4 billion. That sits well below management’s guidance range.
Traditional cloud providers including Microsoft and Amazon face capacity shortages due to booming AI demand. This creates openings for specialized providers like Nebius.
Management announced an at-the-market equity program allowing the issuance of up to 25 million shares. This gives the company flexibility to raise capital when market conditions are favorable.
Rival CoreWeave’s stock dropped after reporting Q3 results Monday. The company reduced full-year revenue guidance citing delays in data center electrical infrastructure.
Nebius will complete deployment for the Meta contract within three months, with customer demand remaining robust across its platform.
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