Nebius Reports Bigger Q3 Net Income Loss, Announces Meta AI Deal, Shares Fall

Core Insights - Nebius reported a higher net income loss than expected for Q3, with a loss of nearly $120 million compared to $43.6 million a year earlier, while revenue increased by 355% to $146.1 million, excluding discontinued operations [2][3] - The company announced a significant agreement with Meta Platforms valued at approximately $3 billion over five years for artificial intelligence compute infrastructure [2][3] - Nebius also launched an equity offering of 25 million Class A shares to raise capital for data center build-outs [3] Company Performance - Nebius stock fell 1.9% to 107.88 after the earnings report, despite a 264% increase in 2025 prior to the report [5] - Wall Street analysts had predicted a net income loss of $97 million for Nebius on revenue of $155 million, indicating a larger-than-expected loss [3] - The stock has a Composite Rating of 56 out of a best possible 99, reflecting mixed investor sentiment [8] Industry Context - Nebius operates in the cloud computing sector, providing servers equipped with Nvidia AI accelerators primarily to AI model builders and app developers [4][7] - CoreWeave, a competitor, reported better-than-expected earnings but lowered its guidance for full-year revenue and capital spending due to capacity delays, causing its stock to drop over 10% [6] - The AI infrastructure market is seeing significant activity, with Nebius and CoreWeave being key players in providing necessary computing resources [9]