Nebius Emerges as Major AI Infrastructure Player with Landmark Microsoft Deal
Breaking New Ground in AI Infrastructure
Nebius Group’s stock surged nearly 50% following the announcement of a multi-billion-dollar deal with Microsoft. The Amsterdam-based company has secured a multi-year agreement worth up to $19.4 billion to provide cloud computing power for AI workloads.
From Russian Roots to Global AI Player
Originally established in 1989 as Yandex N.V., the company underwent a significant transformation in July 2024 when it sold its Russian assets due to international sanctions during the Russian invasion of Ukraine. The company rebranded as Nebius Group, pivoting to focus on artificial intelligence.
Current Operations and Capabilities
Nebius has positioned itself as a full-stack, specialized AI cloud player, covering the entire AI infrastructure value chain – from data centers and in-house designed servers to AI cloud platforms and LLM expertise. The company boasts a strong team of approximately 400 AI/ML/software & cloud engineers with proven experience in delivering at scale.
Expansion and Future Prospects
The company is actively expanding its infrastructure, with plans to triple its data center capacity to approximately 75 MW by early 2026. It currently operates co-location facilities in Paris with Equinix and in Kansas City with Patmos. The Kansas City facility is expected to scale to 40 MW, while the Paris cluster will be among the first in Europe to receive new Blackwell GPUs.
Financial Outlook
Nebius currently maintains a market capitalization of $12 billion, with Q1 revenue showing an impressive 385% year-over-year increase to $55.3 million. The company’s aggressive growth strategy requires substantial investment, but it is well-positioned with more than $3 billion in cash, including $2.5 billion from its divestment and an additional $700 million raised from top-tier investors.
The Microsoft agreement marks Nebius’s first long-term contract with a major tech company, with the company indicating that more similar deals are likely to follow.