Nebius Stock Keeps Falling. Here’s Why You Should Be a Buyer

Company Overview - Nebius Group (NASDAQ:NBIS) gained attention after Nvidia revealed its investment in the company, participating in a $700 million private placement and currently holding nearly 1.2 million shares valued at approximately $112 million [1] - The company has become a significant player in the AI infrastructure sector, driven by the increasing demand for GPU-intensive processing [1] Financial Performance - Nebius reported a remarkable growth in core AI revenues, soaring approximately 400% year-over-year and 40% quarter-over-quarter in the latest period [2] - Despite the stock reaching record highs, shares have since dropped 33% from that peak, with a notable 20% decline in the past week due to third-quarter earnings that fell short of revenue expectations [3] Market Position and Strategy - The company is strategically focusing on energy supply as a critical factor for AI development, with Microsoft CEO Satya Nadella emphasizing that energy and data center space are the primary bottlenecks [4] - Nebius aims to increase its contracted capacity to 2.5 gigawatts by late 2026, reflecting a strong bet on sustained demand for AI infrastructure [5] Capacity and Contracts - Achieving multi-gigawatt operations would allow Nebius to support hundreds of thousands of GPUs, positioning it as a cornerstone provider for AI workloads [6] - The company secured significant contracts, including a $3 billion five-year agreement with Meta and a $17.4 billion deal with Microsoft for AI infrastructure [7]