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Nebius Stock Up Post Q1 Earnings: Should You Buy, Hold or Sell?
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Key Takeaways
NBIS shares jumped after Q1 revenue surged 684% amid strong AI cloud demand.
Nebius raised 2026 capex guidance to $20B-$25B to support future AI capacity growth.
NBIS secured a $27B Meta agreement and expanded NVIDIA AI infrastructure partnerships.
Nebius Group N.V. (NBIS - Free Report) stock gained approximately 7% following first-quarter 2026 results reported on 13 May, 2026, fueled by strong revenue growth amid a robust AI demand environment.
Shares of the company have gained 125.7% in the past three months, outperforming the Zacks Computer & Technology sector and the Zacks Internet Software Services industry, which grew 22.3% and 25.1%, respectively. The S&P 500 composite is up 11.1% over the same time frame. The company’s shares have surged 157.2% in the past six months.
Image Source: Zacks Investment Research
NBIS has outpaced its peer, CoreWeave, Inc. (CRWV - Free Report) , which has gained 18.9% during the same interval.
Can NBIS sustain its momentum, or is it time to trim positions? Let’s break down the company’s latest results, growth drivers and long-term prospects to determine whether staying invested still makes sense.
NBIS's Q1 Earnings Snapshot
Nebius Group reported a first-quarter 2026 adjusted net loss of $100.3 million, 20% wider than a loss of $83.6 million incurred a year ago. The increase in loss was primarily due to continued investments in infrastructure expansion, AI platform development, acquisitions and engineering talent.
The company’s revenues surged 684% year over year to $399 million. Nebius AI business revenue, which excludes Avride and TripleTen, increased 841% year over year to $390 million. The increase in sales was primarily driven by rapid capacity scaling, strong utilization levels and favorable pricing dynamics across the company’s core AI cloud operations.
CoreWeave reported first-quarter revenues of approximately $2.08 billion, more than doubling year over year.
Image Source: Zacks Investment Research
Group adjusted EBITDA for Nebius improved significantly to $129.5 million from a loss of $53.7 million in the year-ago quarter. Group adjusted EBITDA margin expanded to 32%, supported by operating leverage and strong execution. Within the Nebius AI business, adjusted EBITDA margin expanded sharply to 45% from 24% in the fourth quarter of 2025, reflecting strong revenue growth and improving platform economics.
Nebius significantly strengthened its balance sheet during the quarter. The company raised approximately $4.3 billion through convertible senior notes and secured a $2 billion equity investment from NVIDIA Corporation (NVDA - Free Report) , increasing cash and cash equivalents to $9.3 billion at quarter-end. Operating cash flow surged to $2.26 billion, primarily driven by upfront customer payments.
Nebius also disclosed a major five-year $27 billion agreement with Meta Platforms, Inc. (META - Free Report) , including a $12 billion dedicated compute commitment and an additional $15 billion optional capacity arrangement. Management stated that the agreement provides financing flexibility while enabling Nebius to allocate capacity between Meta and higher-margin AI cloud customers.
For 2026, Nebius reiterated its guidance for annualized run-rate revenue of $7 billion to $9 billion, group revenue of $3 billion to $3.4 billion and group adjusted EBITDA margin of around 40%. Management expects quarterly EBITDA margin variability due to the timing of capacity deployments and ongoing investments in infrastructure, engineering and software capabilities.
Nebius raised its 2026 capital expenditure guidance to between $20 billion and $25 billion from the prior range of $16 billion to $20 billion, reflecting accelerated investments to support anticipated 2027 demand. Management emphasized that the higher spending is driven by strong customer commitments and future capacity requirements rather than material cost inflation.
Key Drivers Fueling the Recent Surge
Nebius’ strong performance is being driven by aggressive infrastructure expansion, rising enterprise AI adoption and rapid growth in its full-stack AI cloud platform. The company continues to scale capacity aggressively to meet surging demand for AI workloads. During the first quarter, Nebius increased contracted power capacity to more than 3.5 gigawatts and raised its 2026 target to at least 4 gigawatts. It also announced a new Pennsylvania AI factory site capable of supporting up to 1.2 gigawatts of power capacity, strengthening its long-term infrastructure footprint.
Another major growth driver is Nebius’ vertically integrated AI cloud strategy. The company is expanding beyond compute infrastructure into inference, agentic AI and software orchestration capabilities. Management highlighted strong momentum in its Token Factory inference platform, which is gaining traction among enterprises and AI-native customers. Acquisitions of Eigen AI, Clarifai and Tavily enhanced Nebius’ inference optimization, agentic search and software capabilities, helping the company strengthen its full-stack AI ecosystem.
Nebius Group N.V. Price, Consensus and EPS Surprise
Strategic partnerships are also supporting growth momentum. Nebius expanded its collaboration with NVIDIA and achieved NVIDIA Exemplar Cloud status for GB300 training workloads, positioning the company among a limited number of AI infrastructure providers with advanced GPU deployment capabilities. Management noted that the partnership improves supply-chain visibility and access to future GPU generations, including Vera Rubin platforms.
Demand trends remain exceptionally strong across AI-native firms, enterprises and hyperscalers. Nebius stated that pipeline generation increased 3.5 times sequentially during the first quarter, excluding hyperscaler agreements such as Meta. Management also emphasized that multiple customers are often competing for every GPU brought online, reflecting a persistent supply-demand imbalance in AI infrastructure markets.
The company is also benefiting from increasing adoption across diverse industries. Customers in fintech, healthcare, robotics, manufacturing, pharmaceuticals and life sciences are leveraging Nebius’ cloud and inference platforms for large-scale AI deployments. Management highlighted growing momentum in inference workloads, which it views as one of the fastest-growing opportunities in the AI cloud market.
However, Nebius’ aggressive expansion strategy introduces significant execution and financial risks. The company substantially increased its capital expenditure outlook to between $20 billion and $25 billion for 2026 as it accelerates infrastructure buildouts for future AI demand. Such elevated spending levels could pressure cash flows and increase financing dependence, particularly if customer demand moderates or deployment timelines are delayed. Management acknowledged that much of the current investment is aimed at supporting 2027 capacity, meaning returns on these investments may take time to materialize.
The company also faces operational and competitive risks tied to rapid scaling in the AI infrastructure market. Nebius remains heavily dependent on securing GPU supply, maintaining timely data center construction and managing complex hyperscaler relationships. While demand currently exceeds available capacity, any slowdown in AI infrastructure spending, pricing normalization or delays in bringing new facilities online could adversely impact utilization and margins. The company operates in an increasingly competitive environment where larger cloud providers and AI infrastructure players continue investing aggressively in capacity expansion and AI software ecosystems.
CoreWeave also raised its full-year capital expenditure outlook to $31 billion-$35 billion, citing higher component costs and massive spending required to bring new capacity online. CoreWeave’s interest expense is projected to climb further in the second quarter to as much as $730 million as debt levels rise to fund deployments.
A Look at NBIS' Valuation
In terms of Price/Book, NBIS shares are trading at 12.18X, higher than the Internet Software Services industry’s 4.12X.
Image Source: Zacks Investment Research
Should You Buy, Hold or Sell?
Despite impressive growth momentum, NBIS’ elevated valuation, aggressive capital spending and execution risks could limit near-term upside after the stock’s sharp rally.
Existing investors may consider holding their positions, while new investors could wait for a better entry point.
View the Zacks #1 Rank List
Image: Bigstock
Nebius Stock Up Post Q1 Earnings: Should You Buy, Hold or Sell?
Key Takeaways
Nebius Group N.V. (NBIS - Free Report) stock gained approximately 7% following first-quarter 2026 results reported on 13 May, 2026, fueled by strong revenue growth amid a robust AI demand environment.
Shares of the company have gained 125.7% in the past three months, outperforming the Zacks Computer & Technology sector and the Zacks Internet Software Services industry, which grew 22.3% and 25.1%, respectively. The S&P 500 composite is up 11.1% over the same time frame. The company’s shares have surged 157.2% in the past six months.
Image Source: Zacks Investment Research
NBIS has outpaced its peer, CoreWeave, Inc. (CRWV - Free Report) , which has gained 18.9% during the same interval.
Can NBIS sustain its momentum, or is it time to trim positions? Let’s break down the company’s latest results, growth drivers and long-term prospects to determine whether staying invested still makes sense.
NBIS's Q1 Earnings Snapshot
Nebius Group reported a first-quarter 2026 adjusted net loss of $100.3 million, 20% wider than a loss of $83.6 million incurred a year ago. The increase in loss was primarily due to continued investments in infrastructure expansion, AI platform development, acquisitions and engineering talent.
The company’s revenues surged 684% year over year to $399 million. Nebius AI business revenue, which excludes Avride and TripleTen, increased 841% year over year to $390 million. The increase in sales was primarily driven by rapid capacity scaling, strong utilization levels and favorable pricing dynamics across the company’s core AI cloud operations.
CoreWeave reported first-quarter revenues of approximately $2.08 billion, more than doubling year over year.
Image Source: Zacks Investment Research
Group adjusted EBITDA for Nebius improved significantly to $129.5 million from a loss of $53.7 million in the year-ago quarter. Group adjusted EBITDA margin expanded to 32%, supported by operating leverage and strong execution. Within the Nebius AI business, adjusted EBITDA margin expanded sharply to 45% from 24% in the fourth quarter of 2025, reflecting strong revenue growth and improving platform economics.
Nebius significantly strengthened its balance sheet during the quarter. The company raised approximately $4.3 billion through convertible senior notes and secured a $2 billion equity investment from NVIDIA Corporation (NVDA - Free Report) , increasing cash and cash equivalents to $9.3 billion at quarter-end. Operating cash flow surged to $2.26 billion, primarily driven by upfront customer payments.
Nebius also disclosed a major five-year $27 billion agreement with Meta Platforms, Inc. (META - Free Report) , including a $12 billion dedicated compute commitment and an additional $15 billion optional capacity arrangement. Management stated that the agreement provides financing flexibility while enabling Nebius to allocate capacity between Meta and higher-margin AI cloud customers.
For 2026, Nebius reiterated its guidance for annualized run-rate revenue of $7 billion to $9 billion, group revenue of $3 billion to $3.4 billion and group adjusted EBITDA margin of around 40%. Management expects quarterly EBITDA margin variability due to the timing of capacity deployments and ongoing investments in infrastructure, engineering and software capabilities.
Nebius raised its 2026 capital expenditure guidance to between $20 billion and $25 billion from the prior range of $16 billion to $20 billion, reflecting accelerated investments to support anticipated 2027 demand. Management emphasized that the higher spending is driven by strong customer commitments and future capacity requirements rather than material cost inflation.
Key Drivers Fueling the Recent Surge
Nebius’ strong performance is being driven by aggressive infrastructure expansion, rising enterprise AI adoption and rapid growth in its full-stack AI cloud platform. The company continues to scale capacity aggressively to meet surging demand for AI workloads. During the first quarter, Nebius increased contracted power capacity to more than 3.5 gigawatts and raised its 2026 target to at least 4 gigawatts. It also announced a new Pennsylvania AI factory site capable of supporting up to 1.2 gigawatts of power capacity, strengthening its long-term infrastructure footprint.
Another major growth driver is Nebius’ vertically integrated AI cloud strategy. The company is expanding beyond compute infrastructure into inference, agentic AI and software orchestration capabilities. Management highlighted strong momentum in its Token Factory inference platform, which is gaining traction among enterprises and AI-native customers. Acquisitions of Eigen AI, Clarifai and Tavily enhanced Nebius’ inference optimization, agentic search and software capabilities, helping the company strengthen its full-stack AI ecosystem.
Nebius Group N.V. Price, Consensus and EPS Surprise
Nebius Group N.V. price-consensus-eps-surprise-chart | Nebius Group N.V. Quote
Strategic partnerships are also supporting growth momentum. Nebius expanded its collaboration with NVIDIA and achieved NVIDIA Exemplar Cloud status for GB300 training workloads, positioning the company among a limited number of AI infrastructure providers with advanced GPU deployment capabilities. Management noted that the partnership improves supply-chain visibility and access to future GPU generations, including Vera Rubin platforms.
Demand trends remain exceptionally strong across AI-native firms, enterprises and hyperscalers. Nebius stated that pipeline generation increased 3.5 times sequentially during the first quarter, excluding hyperscaler agreements such as Meta. Management also emphasized that multiple customers are often competing for every GPU brought online, reflecting a persistent supply-demand imbalance in AI infrastructure markets.
The company is also benefiting from increasing adoption across diverse industries. Customers in fintech, healthcare, robotics, manufacturing, pharmaceuticals and life sciences are leveraging Nebius’ cloud and inference platforms for large-scale AI deployments. Management highlighted growing momentum in inference workloads, which it views as one of the fastest-growing opportunities in the AI cloud market.
However, Nebius’ aggressive expansion strategy introduces significant execution and financial risks. The company substantially increased its capital expenditure outlook to between $20 billion and $25 billion for 2026 as it accelerates infrastructure buildouts for future AI demand. Such elevated spending levels could pressure cash flows and increase financing dependence, particularly if customer demand moderates or deployment timelines are delayed. Management acknowledged that much of the current investment is aimed at supporting 2027 capacity, meaning returns on these investments may take time to materialize.
The company also faces operational and competitive risks tied to rapid scaling in the AI infrastructure market. Nebius remains heavily dependent on securing GPU supply, maintaining timely data center construction and managing complex hyperscaler relationships. While demand currently exceeds available capacity, any slowdown in AI infrastructure spending, pricing normalization or delays in bringing new facilities online could adversely impact utilization and margins. The company operates in an increasingly competitive environment where larger cloud providers and AI infrastructure players continue investing aggressively in capacity expansion and AI software ecosystems.
CoreWeave also raised its full-year capital expenditure outlook to $31 billion-$35 billion, citing higher component costs and massive spending required to bring new capacity online. CoreWeave’s interest expense is projected to climb further in the second quarter to as much as $730 million as debt levels rise to fund deployments.
A Look at NBIS' Valuation
In terms of Price/Book, NBIS shares are trading at 12.18X, higher than the Internet Software Services industry’s 4.12X.
Image Source: Zacks Investment Research
Should You Buy, Hold or Sell?
Despite impressive growth momentum, NBIS’ elevated valuation, aggressive capital spending and execution risks could limit near-term upside after the stock’s sharp rally.
Existing investors may consider holding their positions, while new investors could wait for a better entry point.
At present, NBIS carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.