Nebius Surges 8.62%, 'Buffett of AI' Stake Ignites Rally
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Nebius Group shares surged following the announcement that Situational Awareness, a hedge fund led by former OpenAI researcher Leopold Aschenbrenner, acquired a 5.6% stake valued at $2.6 billion. Aschenbrenner highlighted Nebius's efficiency in addressing AI infrastructure bottlenecks. Nebius, formerly Yandex's overseas business, has secured major infrastructure deals with Meta ($27 billion) and Microsoft ($19.4 billion), and received a $2 billion investment from Nvidia. First-quarter revenue rose 684%, with adjusted EBITDA turning profitable. While analysts are divided, Aschenbrenner's substantial investment signals confidence in the AI cloud infrastructure sector's long-term potential.
TradingKey - As of August 28 ET, AI cloud infrastructure service provider Nebius Group ( NBIS.US) saw its shares surge over 11% intraday before closing at $226.34, up 8.62%. The stock continued to climb over 1.5% in overnight trading, bringing its year-to-date cumulative gain to 170.4%.
The catalyst for the current share price rally was the disclosure that Situational Awareness, a hedge fund led by former OpenAI researcher Leopold Aschenbrenner, has acquired a 5.6% stake in Nebius, purchasing approximately 12.41 million Class A ordinary shares.
As of May 27 ET, the position was valued at approximately $2.6 billion, making Situational Awareness the largest institutional shareholder of Nebius.
In the AI investment space, the 24-year-old Aschenbrenner has built a remarkably rare track record. He was previously a core member of OpenAI's Superalignment team. According to Aschenbrenner: "AI infrastructure is the most critical bottleneck in the compute race, and Nebius has built one of the most efficient capital platforms to address this issue."
Situational Awareness's assets under management (AUM) surged from $225 million to $13.7 billion in less than two years, with returns on its top holdings mostly ranging between 100% and 800%.
Gil Luria, Head of Technology Research at D.A. Davidson, commented: "Over the past few years, he has earned a reputation for precisely picking winners in the AI sector. This stake indicates his belief that the AI cloud sector currently offers the greatest leverage potential."
From a fundamental perspective, Nebius was formerly the overseas business of Russian internet giant Yandex. Following a restructuring, it has completely transformed into a leading AI cloud service provider in Europe.
Endorsement from AI Giants
In March of this year, Meta signed a five-year infrastructure agreement with Nebius totaling $27 billion. During the same period, Nvidia announced a $2 billion investment in Nebius, acquiring an approximately 8.3% stake at a price of $94.94 per share. Additionally, Microsoft is a key customer of Nebius, with the two parties having signed a $19.4 billion partnership agreement last September.
First-quarter earnings showed that revenue surged 684% year-over-year to $399 million, while adjusted EBITDA swung from a loss to a profit of $129.5 million. Management has raised the full-year contracted power target to over 4 gigawatts, as AI infrastructure expansion is progressing ahead of expectations.
Analyst Divergence Intensifies
Analysts also remain divided on the outlook for Nebius.
On May 16, CICC raised its price target to $275 while maintaining an Outperform rating; conversely, D.A. Davidson issued a Neutral rating on May 19 with a target price of $250, suggesting that while the stock enjoys a reasonable growth premium, its room for further short-term upside may be limited. Previously, D.A. Davidson had downgraded Nebius to Neutral, noting that its share price already fully reflects high growth expectations for AI cloud infrastructure.
In the short term, volatility risk in the highly speculative AI infrastructure sector cannot be ignored after months of rapid gains; however, from a longer-term perspective, the signal sent by Aschenbrenner's significant stake in Nebius is instructive: AI cloud infrastructure is evolving into a "savings pool for AI wealth."
For investors seeking genuine infrastructure plays in the AI race, whether the short-term momentum of Nebius's current rally can be sustained will depend on whether its actual progress in power reserves and computing power expansion can continue to be delivered.
This content was translated using AI and reviewed for clarity. It is for informational purposes only.
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