Nebius Group N.V. (NASDAQ: NBIS) is experiencing heightened market attention as of Monday, December 15, 2025, amidst ongoing discussions surrounding its significant capital needs juxtaposed with robust demand signals for its AI infrastructure services. Currently trading in the low-$80s, NBIS shares have shown volatility, dipping mid-single to high-single digits intraday after starting near the high-$80s.
This recent downturn occurs despite the company’s emphasis on long-term contracts with hyperscalers like Microsoft and Meta, which Nebius claims could significantly shape its growth trajectory through 2026. However, these agreements also intensify scrutiny from investors focused on capital expenditure (capex) intensity, financing strategies, and execution risks, as highlighted by several analyses released today.
The decline in stock price seems indicative of a broader market reassessment rather than a direct reaction to a specific unfavorable news story. A report by Simply Wall St correlates the stock’s performance with concerns about capital intensity, suggesting that while the Microsoft contract offers long-term visibility into demand, it also amplifies immediate worries regarding funding and project timelines.
Conversely, a commentary from Zacks emphasizes the pressure stemming from expansion costs and heightened capital spending projections, warning that the risk/reward ratio may not favor new investors at this time, despite the appealing long-term narrative.
Investors are now questioning Nebius’s ability to convert high demand into sustainable, profitable revenue while minimizing reliance on new capital influxes.
The two contracts that changed the narrative: Microsoft and Meta
Nebius’ journey through 2025 has been largely defined by two substantial contracts:
In early September, the company announced a deal with Microsoft valued at $17.4 billion over five years, which could rise to approximately $19.4 billion if additional capacity or services are integrated. This partnership is expected to commence operations from a new data center located in Vineland, New Jersey. CEO Arkady Volozh described the economic prospects of this deal as both attractive and strategically advantageous.
Following this, a deal reported on November 11, 2025, revealed that Nebius signed a contract worth about $3 billion over five years with Meta. This second hyperscaler agreement reaffirms the strong demand for Nebius’ infrastructure, which the company noted is currently limited by its available capacity.
These contracts bolster Nebius’ bullish narrative by validating its position in the AI compute market, but they simultaneously impose higher expectations on the company to deliver timely and scalable infrastructure while managing its financing effectively.
Nebius’ Q3 2025 results indicate an acceleration in its core AI infrastructure growth, although they also underscore the reasons behind investor concerns regarding capital intensity. The company reported a significant revenue increase to $146.1 million, up from $32.1 million a year prior, marking a 355% growth rate. However, net losses widened to $119.6 million from a $43.6 million loss year-on-year, alongside a notable rise in capital expenditures to $955.5 million.
Nebius has been transparent about its funding strategies, establishing an at-the-market (ATM) equity program for up to 25 million Class A shares. This move aims to streamline access to equity funding while acknowledging potential dilution risks. The company had previously raised $4.2 billion through share offerings and convertible notes following the Microsoft deal, emphasizing a focus on margins rather than volume in future hyperscaler contracts.
For investors, the critical question remains how much capital Nebius will require moving forward and the associated costs linked to financing and share dilution.
As for the outlook for 2026, Nebius has set an ambitious target of achieving $7–$9 billion in annualized run-rate revenue (ARR) by year-end. This objective hinges on securing adequate power and capacity, with the company aiming for roughly 2.5 GW of contracted power and 800 MW to 1 GW of connected power by the end of 2026.
In the broader context, Nebius has been working to establish itself beyond just GPU rentals, unveiling the Nebius Token Factory as a comprehensive platform for enterprises to deploy AI models effectively. The company has also been proactive in adopting new technologies, evidenced by its early deployment of NVIDIA Blackwell GPUs.
Despite market skepticism, analysts remain optimistic about Nebius’ potential. A report from TipRanks indicates a “Strong Buy” consensus with an average target of $164.20, while MarketBeat suggests a “Buy” rating with a broader price target range. However, analysts differ significantly in their assessments, reflecting varying perspectives on dilution and capital intensity.
As Nebius approaches year-end, key indicators to watch will include revenue ramp-up from hyperscale contracts, power and capacity milestones, and updates on financing activities. The market’s reception of these developments will likely shape the future trajectory of the stock. In summary, while demand for Nebius’ offerings appears robust, the stock is currently under pressure as the market evaluates its ability to scale efficiently amidst high capital needs.
See also
LG’s webOS Update Mandates Copilot AI on TVs, Sparking User Outcry Over Privacy Risks
Lunit and Daiichi Sankyo Partner to Accelerate AI-Driven Cancer Biomarker Discovery
Nvidia Surges 0.70% as Strong H200 Demand from China Boosts AI Outlook
TIL Limited Unveils Three Indigenous Products at EXCON 2025, Enhancing India’s Infrastructure Solutions
Microsoft AI CEO Mustafa Suleyman Calls Elon Musk a ‘Bulldozer’ with ‘Superhuman Capabilities’
