Nebius Races Toward Earnings With a $50 Billion Backlog and a Fresh Bullish Call from BofA

Bank of America raises Nebius price target to $205, citing $50B order backlog and rapid data center expansion, ahead of Q1 earnings.

Bank of America threw its weight behind Nebius Group on Monday, boosting its price target from $175 to $205 just two days before the company’s first-quarter earnings release. The upgrade reaffirms a buy rating and implies roughly 16% upside from the current share price of around $177 — a level near the stock’s all-time high after a powerful year-to-date rally.

The call lands as Nebius prepares to unveil quarterly results on Wednesday, May 13, before the market opens. Behind the optimism lies a staggering backlog of contracted orders worth nearly $50 billion, but also a capital expenditure plan that could top $20 billion this year. Investors are betting the company can turn that massive order book into sustainable revenue without blowing up its balance sheet.

Tech Giants Fuel the Pipeline

The backbone of Nebius’s order book is a handful of blockbuster deals with the industry’s heaviest hitters. Meta Platforms alone has committed roughly $27 billion over five years for dedicated AI infrastructure capacity. Microsoft has signed a multi-year agreement valued at up to $19.4 billion. And Nvidia, the dominant maker of AI chips, has chipped in a $2 billion strategic investment — underscoring the deep interdependence between cloud providers and the hardware ecosystem.

To deliver on those commitments, Nebius is spending at a ferocious pace. Management has guided for capital expenditures of $16 billion to $20 billion in 2026, with about 60% of that funded by customer prepayments and the remainder from equity and debt. A recently completed convertible bond offering worth $4.3 billion shores up part of the financing.

The spending spree weighs heavily on the income statement. The company expects a negative operating result for the full year, as the priority remains buying expensive graphics processors and building out capacity rather than chasing near-term profit.

From Two Data Centers to 16 in One Year

Physical expansion illustrates the scale of the ambition. At the end of 2024, Nebius operated just two data centers. By the end of this year, that number is expected to jump to 16, spread across the United States, Europe and Israel.

The energy requirements are equally staggering. Nebius has already secured more than three gigawatts of contracted power capacity for 2026, with up to 1,000 megawatts expected to go live by year-end.

Revenue has followed a similar trajectory — albeit from a low base. For the first quarter of 2026, analysts project sales of up to $374 million, compared with roughly $55 million in the same period last year. But losses are widening: the consensus estimate calls for a loss of about $0.80 per share. For the full year, management has guided for revenue between $3.0 billion and $3.4 billion, a massive leap from $530 million in fiscal 2025.

A Rich Valuation Tests Patience

The market has priced much of this optimism in already. At a price-to-book ratio of nearly ten, Nebius trades well above the industry average. Its trailing price-to-earnings multiple of 364 reflects growth expectations rather than current earnings — the five-year median is nearer 28. The current market capitalization stands at roughly $45 billion.

Analysts remain split. Zacks has recommended holding the stock, citing the stretched valuation and stiff competition from rivals such as CoreWeave. Bank of America, by contrast, sees ample room for further gains, pointing to the strength of the backlog and the strategic partnerships.

Wednesday’s report will need to back up the bullish narrative. Investors will zero in on how quickly Nebius is integrating Eigen AI, the company it recently acquired. Another key metric: annualized recurring revenue, which management aims to reach between $7 billion and $9 billion by the end of the year. A miss on that target could trigger a sharp reversal in sentiment.