Why Investors Are Suddenly Watching Nebius Stock Closely

Core Insights - Nebius (NBIS) is rapidly gaining traction in the AI infrastructure sector, with stock prices increasing by 218% year to date, outperforming major tech companies [1] - The company has secured multibillion-dollar contracts with Microsoft and Meta Platforms, indicating a strong growth trajectory [1] Company Overview - Nebius specializes in full-stack AI infrastructure and operates a cloud platform tailored for intensive AI workloads, utilizing Nvidia hardware [3] - In addition to its core business, Nebius owns brands like Avride (autonomous driving) and TripleTen (tech education), and holds equity stakes in companies such as ClickHouse and Toloka [4] Financial Performance - In Q3, Nebius reported group revenue of $146 million, reflecting a 355% year-over-year increase and a 39% sequential rise [5] - The core infrastructure business, which constitutes over 90% of total revenue, experienced a 400% year-over-year growth, with adjusted EBITDA margins nearing 19% [5] - Management indicated that revenue growth was constrained only by the speed of bringing additional capacity online [5] Demand and Capacity - CEO Arkady Volozh noted a significant increase in capacity demand, with all new infrastructure units selling out immediately [6] - The demand has led to substantial partnerships, including a new $3 billion, five-year agreement with Meta Platforms, which was limited by available capacity [7] - The size of the Meta deal highlights the unmet demand for Nvidia-powered AI infrastructure, especially with the upcoming Blackwell generation [7]