Nebius Wagers $25 Billion on AI Infrastructure While Debt Swells 1,000%
Published on 07/03/2026 at 02:44 | Redaktion boerse-global.de
The euphoria that propelled Nebius into the ranks of Europe’s hottest AI infrastructure plays is giving way to a far more sobering reality check. The company, which emerged as a specialized spin-off and now commands a market capitalization of roughly €58 billion, finds itself caught between a breathtaking expansion plan and a balance sheet that has ballooned beyond recognition. Total liabilities have surged more than 1,000% year-over-year to $15 billion, while long-term debt doubled to $8.4 billion. The bill for building out next-generation compute capacity is coming due, and investors are asking how long the cash burn can last before revenues catch up.
The strain has already hit the stock. Shares slid more than 7% on Thursday to €187.10, extending a pullback that now sits roughly 28% below the June record high. Over the past 30 days, the loss has reached about 13%. The sell-off reflects a growing unease over competitive dynamics with one of Nebius’s most critical partners. Reports that Meta Platforms is weighing its own cloud-compute initiative — effectively becoming a seller of excess AI capacity — have forced the market to reassess the entire business model. If a customer turns into a rival, the $27 billion framework agreement that anchors Nebius’s order book suddenly looks more fragile. Still, management is moving ahead: the investment budget for 2026 has been raised to as much as $25 billion.
Operationally, the story is one of explosive growth coupled with enormous expense. First-quarter revenue hit $399 million, a 684% jump from a year earlier, and adjusted operating income swung to a positive $129.5 million. Yet the company is spending at a pace that dwarfs those earnings. To fund the buildout, Nebius is turning to asset-backed financings secured by contracts with Meta and Microsoft, as well as customer prepayments. Cash reserves have been replenished through convertible bond offerings, climbing to $9.3 billion. The strategy carries obvious risk: the expected annual revenue of $3.4 billion remains a fraction of the planned capital outlay.
Should investors sell immediately? Or is it worth buying Nebius?
Adding to the anxiety, insider sales worth $132 million have hit the tape in recent weeks. Nebius has sought to calm nerves by explaining that chief executive Arkady Volozh sold shares exclusively to cover tax obligations. The broader message from the corner office is that the long-term trajectory remains intact. Fourteen analysts on Wall Street largely agree, maintaining an average price target of $244 per share. But the stock’s acute sensitivity to any hint of trouble — be it from Meta’s ambitions or from the company’s own financing needs — underscores how high the stakes have become.
On the ground, the expansion is tangible. Nebius is pouring £1.7 billion into new AI data centers in the United Kingdom, a project slated to deliver an additional 65 megawatts of capacity by early 2027. The company’s inclusion in the Nasdaq Select Index in June triggered significant inflows from passive funds, adding a layer of institutional support. Founder Arkady Volozh is effectively running the race a second time, betting that a first-mover advantage in European neocloud infrastructure will eventually pay off.
Technically, the stock is testing a critical line of defense. At the current €187.10, the share price hovers barely above its 50-day moving average, a level where short-term sellers and longer-term holders are battling for control. The relative strength index has cooled to 42.6, signaling that the recent decline has not yet pushed the stock into oversold territory. The cushion provided by the 200-day average remains substantial — shares trade about 62% above that mark — but the extreme volatility that has made Nebius one of the most turbulent large-cap tech names shows no sign of easing. For now, the market demands proof that the infrastructure being built at breakneck speed will actually be filled.
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