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Nebius Group (NBIS)
NASDAQ:NBIS
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Nebius Group
(NASDAQ:NBIS)
Rating:58Neutral
Price Target:
$55.00
▲(6.10%Upside)
Positive Factors
Competitive Advantage
Adding GPUs at a rapid pace should close the competitive gap with CoreWeave and puts NBIS on stronger footing for a higher valuation.
Expansion and Growth
Nebius Group is viewed as the best positioned neocloud player, with substantial revenue opportunities within its planned data center footprint.
Market Positioning
Nebius Group positions itself as a more transparent and flexible alternative in AI computing, offering lower rates for renting GPUs than major hyperscalers.
Negative Factors
Capital Expenditure
NBIS spent more than $540 million on capital expenditures in the first quarter and is now projecting as much as $2 billion total for the full year as it tries to keep up with demand.
Financial Performance
EBITDA adj (2024) is expected to be negative at $(37.6M).
Market Environment
The market is currently in a risk-off environment where growth names such as NBIS are most prone to experiencing selling pressure.
Nebius Group (NBIS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$12.34B
Dividend YieldN/A
Average Volume (3M)15.69M
Price to Earnings (P/E)189.8
Beta (1Y)1.42
Revenue Growth-97.73%
EPS Growth-217.89%
CountryUS
Employees1,371
SectorCommunication Services
Sector Strength93
IndustryInternet Content & Information
Share Statistics
EPS (TTM)-0.43
Shares Outstanding202,410,160
10 Day Avg. Volume13,215,180
30 Day Avg. Volume15,685,037
Financial Highlights & Ratios
PEG Ratio0.00
Price to Book (P/B)1.75
Price to Sales (P/S)0.00
P/FCF Ratio-53.96
Enterprise Value/Market Cap0.50
Enterprise Value/Revenue0.37
Enterprise Value/Gross Profit140.03
Enterprise Value/Ebitda6.76
Forecast
1Y Price Target
$66.50Price Target Upside28.28% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
Nebius Group Business Overview & Revenue Model
Company DescriptionNebius Group N.V., operates as a technology company that engages in building full-stack infrastructure to service the global AI industry. Its businesses include Nebius, an AI-centric cloud platform built for intensive AI workloads. Nebius builds full-stack infrastructure for AI, including large-scale GPU clusters, cloud platforms, and tools and services for developers. The company's businesses also comprise Toloka AI, a data partner for various stages of generative AI development; TripleTen, an edtech player re-skilling people for careers in tech; and Avride, which develops autonomous driving technology for self-driving cars and delivery robots. The company was formerly known as Yandex N.V. and changed its name to Nebius Group N.V. in August 2024. Nebius Group N.V. was founded in 1989 and is headquartered in Amsterdam, the Netherlands with R&D hubs across Europe, North America and Israel.
How the Company Makes MoneyNebius Group makes money through a subscription-based revenue model, where businesses pay for access to its cloud computing services. Key revenue streams include fees for cloud storage, computing power, and additional services such as data analytics and machine learning tools. The company also generates income from consulting services and technical support offered to its clients. Significant partnerships with technology providers and enterprise clients contribute to its earnings by expanding its market reach and enhancing its service offerings. Through these diverse revenue streams, Nebius Group capitalizes on the growing demand for cloud solutions in the digital age.
Nebius Group Earnings Call Summary
Earnings Call Date:May 20, 2025
(Q1-2025)
| % Change Since: 38.02%|
Next Earnings Date:Jul 23, 2025
Earnings Call Sentiment Positive
The earnings call presented a positive outlook with exceptional revenue growth and strategic partnerships. However, challenges remain with profitability and increased capital expenditure. The company shows promise in expanding its market presence and technological advancements.Q1-2025 Updates
Positive Updates
Explosive Revenue Growth
Revenue grew nearly 400% year-over-year, and annualized run rate revenue increased by nearly 700%.
Strong Cash Position
Ended the quarter with a solid cash balance of $1.4 billion.
New Partnerships and Locations
Established partnerships with NVIDIA, Meta, and Llama; added new locations in the U.S., Europe, and the Middle East.
Product Launches and Technological Advancements
Launched Slurm-based cluster upgrades, improved object storage, and expanded integrations with AI platforms.
Customer and Market Expansion
Hundreds of customers across various industries, with strong demand in AI compute continuing into Q2.
Negative Updates
Negative Adjusted EBITDA Guidance
Expect adjusted EBITDA to be negative for the full year, with a plan to turn positive in the second half of 2025.
Increased CapEx Guidance
Raised CapEx guidance to approximately $2 billion for 2025, up from the previous guidance of $1.5 billion.
Long-Term Profitability Challenges
While aiming for mid-term EBIT margins of 20% to 30%, profitability remains a future goal, with potential for higher long-term margins.
Company Guidance
During the earnings call for Q1 2025, Nebius reported a remarkable revenue growth of nearly 400% year-over-year and an annualized run rate revenue increase of almost 700%. The company ended the quarter with a solid cash balance of $1.4 billion and plans to invest approximately $2 billion in CapEx for 2025, up from the previous guidance of $1.5 billion. This increase is partly due to new opportunities, such as a data center in Israel. Nebius also announced several partnerships, including those with NVIDIA, Meta, and Llama, and highlighted industry recognition from SemiAnalysis. The company reiterated its ARR guidance for the full year, set between $750 million to $1 billion, and overall revenue guidance ranging from $500 million to $700 million. Despite expecting adjusted EBITDA to be negative for the full year, they plan to achieve profitability in the second half of 2025. Looking ahead, Nebius aims for mid-single-digit billions in revenue in the midterm with expected EBIT margins of 20% to 30%.Nebius Group Financial Statement Overview
Summary
Nebius Group faces significant financial challenges, with declining revenues and profitability, incomplete balance sheet data, and weak cash flow management. The company's financial health is concerning, given the negative net income, zero cash flows, and rising leverage.Income Statement
The company has experienced significant volatility in its financial performance. The revenue has drastically declined from 2023 to 2024, leading to a negative EBIT and EBITDA. The net income has also turned negative, indicating financial distress. However, the gross profit margin remains relatively strong, suggesting some operational efficiency.40
Negative
Balance Sheet
The balance sheet data for 2024 is incomplete, making it challenging to assess current financial stability. Historically, the company had a reasonable debt-to-equity ratio and a healthy equity base. However, the increase in net debt in previous years suggests rising leverage, which could pose risks if profitability continues to decline.50
Neutral
Cash Flow
The cash flow statement highlights concerns, especially with zero operating cash flow and free cash flow in 2024. Previously, the company had positive operating cash flows, but current data suggests cash management issues. The absence of capital expenditure figures further complicates the analysis.30
Negative
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 117.50M | 9.04B | 7.00B | 4.78B | 2.95B |
| Gross Profit | 44.10M | 4.97B | 3.87B | 2.44B | 1.78B |
| EBITDA | -307.70M | 1.32B | 1.72B | 345.39M | 945.63M |
| Net Income | -641.40M | 224.49M | 529.73M | ― | 332.14M |
Balance Sheet | |||||
| Total Assets | 3.55B | 8.89B | 8.28B | 6.91B | 6.93B |
| Cash, Cash Equivalents and Short-Term Investments | 2.45B | 1.16B | 1.13B | 1.44B | 3.20B |
| Total Debt | 36.40M | 2.36B | 1.39B | 1.89B | 1.46B |
| Total Liabilities | 294.90M | 5.54B | 3.74B | 3.25B | 2.25B |
| Stockholders Equity | 3.25B | 3.35B | 4.25B | 3.46B | 4.37B |
Cash Flow | |||||
| Free Cash Flow | -562.10M | 746.40M | ― | ― | 108.23M |
| Operating Cash Flow | 245.60M | 829.80M | 559.57M | 124.62M | 438.20M |
| Investing Cash Flow | 311.60M | -1.92B | ― | 294.94M | ― |
| Financing Cash Flow | 825.50M | 472.75M | ― | ― | 1.88B |
Nebius Group Technical Analysis
Positive
51.84
Price Trends
36.82
Positive
33.40
Positive
29.11
Positive
Market Momentum
3.89
Positive
64.38
Neutral
62.35
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NBIS, the sentiment is Positive. The current price of 51.84 is above the 20-day moving average (MA) of 47.18, above the 50-day MA of 36.82, and above the 200-day MA of 29.11, indicating a bullish trend. The MACD of 3.89 indicates Positive momentum. The RSI at 64.38 is Neutral, neither overbought nor oversold. The STOCH value of 62.35 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NBIS.
Nebius Group Risk Analysis
Nebius Group disclosed 53 risk factors in its most recent earnings report. Nebius Group reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Nebius Group Peers Comparison
Overall Rating
UnderperformOutperform
Sector (54)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $1.65B | 25.06 | 9.18% | 4.22% | 26.71% | -23.67% | |
75 Outperform | $876.80M | 23.56 | 32.17% | ― | 113.43% | ― | |
71 Outperform | $2.19B | 16.54 | 19.74% | ― | 5.93% | 29.17% | |
60 Neutral | $3.00B | ― | -15.07% | ― | -18.11% | -516.37% | |
58 Neutral | $12.34B | 189.78 | -10.51% | ― | -97.73% | -217.89% | |
54 Neutral | AU$3.52B | 17.10 | -1.37% | 3.31% | 4.24% | -16.74% | |
| $4.82B | ― | -19.06% | ― | ― | ― |
* Communication Services Sector Average
Performance Comparison
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51.84
32.90
173.71%
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.