Nebius beats estimates as customers race to secure AI computing power
Aug 12 : Nebius beat quarterly revenue estimates on Wednesday as booming demand for AI infrastructure helped it land larger contracts and increase prices, sending shares of the cloud-computing company up more than 17 per cent in early trading.
The results came a day after larger rival CoreWeave raised its annual forecasts, with shares of AI infrastructure companies broadly advancing as strong results from both firms reinforced investor expectations that demand for AI computing capacity continues to outstrip supply.
Revenue at Nebius' mainstay AI cloud unit rose nearly sixfold, powering overall sales to $582.3 million in the second quarter ended June, which beat estimates of $572.75 million, according to LSEG data.
Nebius is converting growing demand into "contracted, profitable growth", CEO Arkady Volozh said.
The Nvidia-powered AI cloud provider paired strong customer demand with dealmaking, signing four contracts worth more than $1 billion each on average during the quarter.
Total contract value nearly quadrupled from the prior quarter, while new-customer contract values jumped more than ninefold.
Capital expenditures totaled about $5.7 billion during the quarter, topping analysts' expectations of $4.7 billion, according to Visible Alpha, as Nebius continued investing aggressively in GPUs and data-center expansion.
When asked about xAI offering computing capacity at premium prices, a Nebius executive said "all new players coming into the market don't change the market for us," adding the company could sell all its planned 2027 capacity at current terms.
AI cloud deals signed in the quarter, with annual contract values above $20 million per megawatt, are expected to come online in late fourth quarter, the company said.
It raised its contracted power target for the end of 2026 to 5 gigawatts from more than 4 gigawatts previously and said it expects to deploy more than 1 GW of capacity annually starting in 2027.
The company expects more than $9 billion in customer prepayments this year and said it has more than $40 billion in customer commitments.
