MarketBeatยท2025-09-11 12:24Core Insights - Nebius Group's stock surged 49.42% to close at $95.72 on September 9th, driven by extraordinary trading volume and investor interest [1][2] - The catalyst for this surge was a multi-year agreement with Microsoft valued at $17.4 billion, which is a transformative event for Nebius [3][4] - This contract not only exceeds Nebius's market capitalization of approximately $15.1 billion but also significantly surpasses its 2025 annualized run-rate guidance of $900 million to $1.1 billion [6] Financial Impact - The Microsoft agreement includes a $2 billion option for additional services, potentially raising the total value to $19.4 billion [4] - The partnership extends through 2031, providing Nebius with a stable revenue stream for nearly a decade [5] - Nebius plans to raise $3 billion through a public sale of Class A shares and a private placement of convertible senior notes to support the expansion required for the contract [11][12] Strategic Importance - Securing a contract of this magnitude from Microsoft serves as a significant endorsement of Nebius's full-stack platform, which combines proprietary software and in-house designed hardware [8] - The deal positions Nebius among the top independent infrastructure providers in the AI sector, marking a crucial shift in the AI supply chain [9] - Nebius's established relationship with NVIDIA adds technical credibility, likely influencing Microsoft's decision [10] Future Outlook - The investment thesis for Nebius has shifted from high potential to proven performance capabilities recognized by a major technology firm [14] - The focus for investors will now be on the execution of the New Jersey data center buildout and the deployment of capacity for Microsoft [15] - Analysts have raised price targets for Nebius, with BWS Financial setting a target of $130 following the news [15][16]