Nebius’ 684% Revenue Surge Comes With a $9.4 Billion Tab

Nebius Group's AI-cloud revenue jumps 841% and lands $27B Meta deal, but $9.4B debt and 20% short interest highlight risks.

The math behind Nebius Group’s blistering AI-cloud expansion is straightforward—and sobering. To land a $49 billion backlog and a marquee deal with Meta, the company has taken on debt that ballooned from $288 million in 2022 to more than $9.4 billion today. That leverage is the flipside of a growth story that saw revenue hit $399 million in the first quarter, a 684% jump from a year earlier.

Almost all of that top line—98%—came from the AI cloud segment, where revenue surged 841%. The business is selling GPU-as-a-Service to developers and enterprises, and the demand pipeline looks stuffed: the bulk of capacity coming online over the next twelve months is already under contract. Nebius originally targeted 3 gigawatts of secured power capacity by the end of 2026, but that figure now stands at 3.5 GW, with a new goal of 4 GW.

That infrastructure buildout is expensive. Depreciation and amortization alone hit $580 million in the first quarter, representing roughly 66% of revenue. Still, adjusted EBITDA reached $129.5 million, good for a margin of 32.45%. In the core AI-cloud segment, margins doubled quarter-on-quarter to around 45%. The annualised revenue run rate now stands at $1.92 billion, up 674% year-over-year.

A $27 Billion Meta Deal Changes the Narrative

The rally in Nebius shares—up 444% over the past twelve months—drew fresh fuel in March when the company signed a $27 billion agreement with Meta. Starting in 2027, that contract alone is expected to generate at least $12 billion in annual revenue. Nvidia separately invested $2 billion to help expand the infrastructure. The market capitalisation has swelled to roughly $53 billion, placing the stock at a forward price-to-earnings ratio of 68.45.

Analysts are split on how much farther the equity can run. Citigroup’s $287 price target tops the bull case, followed by D.A. Davidson at $250 and Goldman Sachs at $234 with a “Buy” rating. Morgan Stanley takes a more cautious stance, rating the shares “Hold” with a $144 target. The wide spread reflects the central tension: the Meta deal and revenue trajectory support a premium, but execution risk and valuation leave little room for error.

Insider Selling and Short Interest Flash Caution

Despite the operational momentum, the market structure carries warning signs. Short interest stands at 20%, a bet by many traders that the stock is due for a pullback. Insider selling added to the unease: over the past three months, company insiders unloaded shares worth $123.8 million, with no insider purchases recorded.

The stock has already shown fragility. After hitting a year-to-date high of $233.80, it shed more than 13% in three sessions, closing near $202. Since the start of the year, however, the gain still stands at roughly 149%.

Dilution Looms as the Next Risk

Nebius has also signalled it may raise additional capital through at-the-market equity offerings, which would dilute existing shareholders. The company has not disclosed how aggressively it plans to use that facility, but the possibility adds another layer of uncertainty.

For now, the revenue outlook remains stellar. Analysts expect full-year 2026 sales of $3.4 billion (a 550% increase) and $10.9 billion in 2027. The $49 billion backlog already exceeds the current market cap, meaning investors are paying for future growth that has yet to materialise. With a debt pile ten times larger than in 2022 and a history of insider exits, Nebius is walking a fine line between historic expansion and a balance sheet that cannot be ignored.