Cloud Computing Company Nebius Rises Over 14% Pre-Market, Earnings Turn Profit for First Time, Company Faces Unprecedented Demand.

Nebius delivered its first earnings inflection point report to investors since its transformation, as adjusted EBITDA swung to a profit of $129.5 million from a loss of $53.7 million in the prior-year period, significantly beating market expectations of $87.2 million. Adjusted net loss was $100.3 million, narrowing significantly from the anticipated $176 million loss. GAAP net income from continuing operations reached $621.2 million, compared with a loss of $104.3 million a year earlier, with the turn to profitability primarily driven by revaluation gains on strategic equity securities such as ClickHouse.

Capital expenditures expanded sharply, while contracted power guidance was revised upward. In the first quarter, the company’s investment in property, equipment, and intangible assets reached $2.47 billion, a 355% year-over-year increase, reflecting an accelerated build-out of AI computing infrastructure to address the surge in demand from AI inference and large-scale deployment.

Meanwhile, Nebius raised its contracted power guidance for the end of 2026 to over 4 GW from its previous target of approximately 3 GW, with connected power expected to remain between 800 MW and 1 GW. This additional power capacity is primarily intended to support a long-term AI infrastructure partnership agreement with Meta; the two parties have signed a five-year deal worth up to $27 billion, marking the largest single contract in Nebius's history.

CEO Arkady Volozh stated in a shareholder letter that enterprises are moving from the experimental phase to production-scale deployment in the AI sector, and the company continues to see “unprecedented demand.”

Full-year revenue guidance was significantly raised. The company reaffirmed and updated its 2026 full-year performance guidance, projecting annual revenue of $3 billion to $3.4 billion and annual recurring revenue of $7 billion to $9 billion, while guiding for a full-year adjusted EBITDA margin of approximately 40%. At the end of the first quarter, the company's cash and cash equivalents balance increased to $9.3 billion, a record high.

Previously, the company completed approximately $6.3 billion in capital raising through the issuance of $4.34 billion in convertible notes, a $2 billion strategic equity investment from Nvidia, and approximately $2 billion in prepayment warrant financing, providing ample 'dry powder' for large-scale data center expansion and potential strategic acquisitions.

Regarding the high-growth characteristics reflected in the first-quarter financial report, several analytical institutions generally pointed out that with the ramp-up of large-scale computing capacity and long-term agreements with hyperscale customers such as Meta and Microsoft, Nebius is transitioning from an 'electricity arbitrage' mining model transformation story into a 'performance validation phase'.

This content was translated using AI and reviewed for clarity. It is for informational purposes only.