Nebius Group (NASDAQ:NBIS) reported second-quarter 2026 revenue growth of 454% from a year earlier as its AI cloud business expanded capacity and utilization, while management reaffirmed its full-year outlook and outlined plans for additional capacity deployment in 2027.
Group revenue rose to $582 million, including $575 million from the Nebius AI business, which represented 98% of total revenue, Chief Financial Officer Dado Alonso said. Annualized run-rate revenue reached $3 billion at the end of June, up from $1.9 billion at the end of March.
Profitability and 2026 Outlook
Group adjusted EBITDA was $236 million, compared with a $21 million loss a year earlier and $129.5 million in the first quarter. Group adjusted EBITDA margin increased to 41% from 32% in Q1.
The Nebius AI unit generated $286 million in adjusted EBITDA, representing a 50% margin. Alonso said the difference between the AI unit’s profitability and the group margin reflected investments in Avride and TripleTen, which he described as early-stage businesses.
Nebius reaffirmed its full-year 2026 targets, including:
- Annualized run-rate revenue of $7 billion to $9 billion;
- Group revenue of $3 billion to $3.4 billion;
- Group adjusted EBITDA margin of about 40%; and
- Capital expenditures of $20 billion to $25 billion.
Management expects capacity deployed late in the second quarter to begin contributing to revenue during the third quarter. Alonso said the company would provide formal 2027 guidance later in the year.
Contracts, Pricing and Capacity Strategy
Chief Executive Officer Arkady Volozh said the company closed four “landmark” core AI cloud contracts during the quarter with Reflection, Cohere, a U.S. Neolab and a U.S.-based quantitative trading firm. He said the agreements averaged more than $1 billion each and carried yields of $20 million to $25 million per megawatt, with customer prepayments covering roughly 50% to 60% of associated capital expenditures.
Volozh said Nebius could sell its entire planned 2027 capacity under similar terms but is retaining some supply for shorter-duration opportunities. These shorter-term agreements, generally lasting up to six months, are being negotiated in the $40 million to $50 million per megawatt range and sometimes above, according to the CEO. He said one such agreement had recently been signed.
Management said the newer agreements are expected to come online later in 2026 and therefore are not expected to materially affect 2026 revenue guidance, but should contribute to 2027 revenue and beyond.
Chief Revenue Officer Marc Boroditsky said the company is weighing customer type, pricing, payment structure, contract duration and deal size when allocating capacity. He said the company’s priorities are existing customers, new customer logos and then contractual terms, including price, upfront prepayments and duration.
Nebius has also shortened how far in advance it sells capacity, Boroditsky said, allowing it to sell closer to deployment while preserving flexibility. The company is reserving part of its capacity for shorter-term requirements that management believes offer the greatest potential realized value.
The company’s first capacity auction cleared at a price 15% above the highest price Nebius had previously charged for Blackwell-generation chips, Volozh said. Boroditsky added that the result was 20% above the company’s Blackwell pipeline pricing. He said the auction and short-term capacity agreements remain take-or-pay arrangements and are intended to provide price-discovery data in a rapidly changing market.
Build-Out Plans and Vineland Update
Nebius raised its year-end contracted power target to 5 gigawatts. Chief Infrastructure and Product Officer Andrey Korolenko said almost all of that contracted power is expected to come online over the next two to three-and-a-half years. The company continues to expect 800 megawatts to 1 gigawatt of connected power by the end of 2026.
Korolenko cautioned that connected power does not immediately translate into revenue. Data centers must be commissioned, networks and clusters built, the platform deployed, and customers onboarded before revenue generation begins, a process he said can take several months. He said the company expects the 2026 connected-power capacity to be active through the first half of 2027.
On the Vineland, New Jersey site, Chief Communications Officer Tom Blackwell said Nebius remains on track with delivery plans despite a public hearing adjourning without a vote. The hearing concerns an amendment to the site layout plan following a switch to Bloom Energy fuel cells for on-site power.
Blackwell said the company believes the revised layout complies with applicable laws and regulations and is optimistic approval will move forward after public input is completed. Korolenko said building construction was completed earlier in the summer, engineering fit-out is progressing, and the Bloom deployment is expected to be fast with no significant impact on the project timeline.
Korolenko also said Nebius has Vera Rubin systems in its laboratories and expects to begin deploying that GPU generation late in 2026 or early in 2027, with deployments continuing through next year.
Funding and Asset-Light Expansion
Nebius reported $2.3 billion of operating cash flow in the quarter and ended June with $8 billion in cash and cash equivalents. Customer prepayments are expected to provide more than $9 billion of upfront funding during 2026, Alonso said.
During the quarter, the company issued 12.7 million Class A shares through its at-the-market equity program at a weighted average price of $224 per share, raising about $2.8 billion in gross proceeds. As of June 30, 12.3 million shares remained available under the program.
In July, Nebius announced a $775 million asset-backed debt facility secured by contracted cash flows. Alonso said the facility was priced at SOFR plus 250 basis points and was backed by deployed GPU infrastructure and an investment-grade customer contract. Management cited more than $40 billion of committed backlog that it believes can support further asset-backed financing.
Volozh also highlighted the company’s asset-light partnership model, under which partners finance, build and operate facilities while Nebius supplies its full-stack platform and customer demand. He said the model requires limited balance-sheet capital and could unlock additional capacity from 2027 onward. The company has received dozens of inquiries from potential partners, though Volozh said the initiative remains at an early stage.
About Nebius Group (NASDAQ:NBIS)
Nebius Group N.V., a technology company, builds intelligent products and services powered by machine learning and other technologies to help consumers and businesses navigate the online and offline world. The company’s services include Nebius AI, an AI-centric cloud platform that offers infrastructure and computing capability for AI deployment and machine-learning oriented solutions; and Toloka AI that offers generative AI (GenAI) solutions at every stage of the GenAI lifecycle, such as data annotation and generation, model training and fine-tuning, and quality assessment of large language model for accuracy and reliability.
