Nebius Pushes Ahead with $775M Financing and UK Expansion, But Alabama Protests and Valuation Concerns Loom

Nebius Group locks $775M secured loan backed by GPUs and customer contracts, while Q1 revenue surges 684% but adjusted losses persist. UK expansion advances amid Alabama data center protests.

Nebius Group has secured a $775 million secured credit facility, a deal that underscores how AI cloud providers are leveraging their physical infrastructure to unlock debt financing. The loan, signed on July 10, 2026, and maturing October 31, 2030, carries an interest rate of SOFR plus 2.50 percentage points. It is collateralized by already-installed GPU systems and the contracted cash flows from a single investment-grade customer. The syndicate backing the facility reads like a who’s who of global banking — MUFG led the charge, with ABN AMRO, Bank of America, Deutsche Bank, HSBC, Citi, Crédit Agricole, ING, Morgan Stanley and Goldman Sachs joining in. The company noted that demand outstripped supply, and Nebius plans to extend the same financing template to a portion of its more than $40 billion in contracted revenue with Microsoft and Meta. “This reflects a disciplined, diversified approach to our capital structure,” said COO Ophir Nave.

The capital-intensive nature of the AI race is laid bare in Nebius’s first-quarter results. Revenue hit $399 million, a 684% surge year over year. Adjusted EBITDA swung to $129.5 million in the black, but the headline net income of $621.2 million was inflated by a one-off $780.6 million valuation gain on investments; strip that out, and the adjusted net loss stood at $100.3 million. Capital expenditures rocketed 355% to $2.47 billion — a clear signal that building out compute capacity does not come cheap. The question hanging over the stock is whether those investments can eventually translate into sustainable profits, especially given the current valuation.

On the geographic front, Nebius is pushing deeper into Europe. The company signed a ten-year agreement to take 22 megawatts of capacity at Kao Data’s Harlow campus in the UK, part of a broader £1.7 billion investment program in the country. The expansion into Britain reflects Nebius’s strategy of deploying capacity in markets with strong demand for AI cloud services and stable regulatory environments.

Across the Atlantic, the picture is more fraught. In Birmingham, Alabama, residents of the Oxmoor Valley neighborhood are pushing back against a planned data center. A lawsuit alleging zoning violations has been stayed until August 12, and Nebius’s legal team insists the project was lawfully approved. The protest leader is calling for a nationwide one- to two-year moratorium on new data centers, while additional sites in Bessemer, Fairfield and Tuscaloosa are also in the pipeline. So far, the local opposition has not derailed Nebius’s plans, but it adds a layer of regulatory and reputational risk to a business that relies on rapid build-out.

Investors, meanwhile, remain cautious. The stock closed at €155.52 on Friday, up 3.62% on the day, but that does little to mask a 36.35% slide over the past 30 days and a 40.41% drop from the 52-week high of €261 reached in June. The relative strength index of 37.4 suggests the shares are near oversold territory, but Jim Cramer — who called Nebius “a very good company” — warned that the stock “isn’t done falling yet.” He identified technical support between $122 and $137. The broader analyst consensus is a target of $244.21, backed by eight buy ratings, six holds and one sell, with one analyst setting a more bullish $286 target. Yet the price-to-earnings ratio of 61.9 towers over the industry average of 28.6. Simply Wall St analysts peg a fair P/E at 70.1, implying the stock could be undervalued by as much as 28% in an optimistic scenario — or overvalued by up to 48% in a pessimistic one.

The immediate drag on sentiment came from Meta’s announcement that it plans to market its own excess compute capacity, reigniting fears that hyperscalers will increasingly bypass external providers like Nebius and CoreWeave. The latter lost roughly 35% of its value in the same period. To compound the pressure, insiders at Nebius sold approximately $27.8 million worth of shares across 33 transactions over the past 90 days. Whether the new $775 million credit line — which buys time without diluting equity — can restore confidence may depend on how quickly the company can turn its breakneck growth into bottom-line credibility.