Nebius Turns an Unexpected Profit as Meta Commits $27 Billion to AI Cloud Capacity

Nebius swings to profit with $2.11 EPS, revenue jumps 684% to $399M on AI cloud growth; Meta pact worth up to $27B sends shares 20% higher to record $215.

Nebius Group delivered a quarter that forced Wall Street to tear up its spreadsheets. The AI cloud infrastructure provider swung from a loss to a profit far beyond what analysts had penciled in, while simultaneously locking in a multi-year partnership with Meta that could be worth as much as $27 billion. Shares shot up nearly 20% in intraday trading, breaking through the stock’s 52-week high of $197.89 to touch around $215.50.

Revenue for the first three months of 2026 hit $399 million, a jump of 684% from a year earlier. The cloud business was the engine: the KI-Cloud segment alone generated $389.7 million, up 841%. Adjusted EBITDA came in at $129.5 million, a sharp reversal from the $53.7 million loss in the prior-year quarter, and the segment’s EBITDA margin ballooned to 45% from 24% in the fourth quarter of 2025. On a per-share basis, Nebius reported adjusted earnings of $2.11 — a far cry from the $0.78 loss the consensus had expected.

The profitability picture was boosted by a non-cash accounting gain. Nebius booked net income of $621 million, largely thanks to a revaluation of its stake in database specialist ClickHouse. Still, the operating momentum was unmistakable, especially given the leap in margins.

Much of the market’s attention focused on the expanded relationship with Meta. The multi-year agreement locks in $12 billion in fixed revenue from dedicated compute capacity beginning in early 2027. An additional $15 billion in flexible capacity can be allocated either to Meta or sold to other AI clients at prevailing market rates, giving Nebius both a revenue floor and upside potential.

To deliver on those commitments, the company is pouring capital into infrastructure at a stunning pace. First-quarter capital expenditure reached roughly $2.5 billion, up from $544 million a year earlier. For the full year, management raised its capex guidance to between $20 billion and $25 billion. Nebius already has contracted power capacity of more than 3.5 gigawatts, surpassing its original 2026 target of 3 gigawatts, and has lifted that goal to above 4 gigawatts. The first spade has gone into the ground for a new campus in Missouri, the second large-scale US site alongside a project in Pennsylvania. By year-end, the company expects 800 megawatts to 1 gigawatt of capacity to be operational.

The build-out is supported by a fortress balance sheet. Nebius ended March with $9.3 billion in cash. It raised $4.3 billion through convertible notes earlier this year and secured a $2 billion strategic investment from Nvidia. The annualized revenue run rate for the KI-Cloud segment stood at $1.92 billion at the end of the first quarter, more than 50% above the level at the close of 2025.

For the full year 2026, management confirmed its revenue forecast of $3.0 billion to $3.4 billion and an operating margin around 40%. The ambition is to push the annualized run rate to $7 billion to $9 billion by year-end. But the path is not entirely smooth. Nebius warned that second-quarter margins will come under pressure from upfront costs related to new server clusters, with profitability recovering only in the second half of the year.

Analysts at Wolfe Research initiated coverage with a neutral rating, acknowledging the robust demand visibility from anchor tenants like Meta but pointing to execution and financing risks tied to the lightning-fast capacity expansion. The share price jump was amplified by short interest that stood at over 20% of the float, likely forcing some bears to cover. For now, Nebius is making a convincing case that it belongs in the top tier of AI-native hyperscalers — and the numbers are backing it up.