The Nvidia Stamp of Approval: Why Nebius’s 339% Rally Is Only Half the Story

Nvidia holds 9.3% of Nebius after a $4.4B stake, as the AI firm debuts Vera Rubin racks. Shares surge 339% yearly but face 111% volatility and 28.55% short interest.

Nvidia now owns 9.3 percent of Nebius Group, a passive stake disclosed alongside a technical milestone that few competitors can match: the Dutch AI infrastructure firm has fired up the first Nvidia rack of the new Vera Rubin NVL72 generation at its Finnish facility and begun validation work, complete with Nvidia Spectrum-6 switches. The chip giant bought roughly 21 million additional shares on July 13 at $210.51 each, bringing its total holdings to about 22.26 million shares — a position that represents roughly one-fifth of Nvidia’s entire equity portfolio.

The endorsement is hard to ignore. Yet Nebius shares, trading at €195.02, have been anything but a straight line upward. The stock has surged 339 percent over twelve months and 165.33 percent year-to-date, but those headline numbers mask a violent ride: a 14.69 percent decline over the past 30 days followed by a 25.37 percent rebound in the last week alone. At 25.28 percent below its June record high of €261.00, the stock sits a staggering 345.25 percent above its 52-week low of €43.80 from last July. Few European equities compress such distance into a single year.

The $25 Billion Question

The volatility traces directly to a fundamental debate playing out in the Neocloud sector. Nebius has revised its 2026 investment plans upward to between $20 billion and $25 billion — though the secondary source puts the range at $16 billion to $20 billion. Management argues the spending is necessary to meet long-term demand, backed by contracted revenue with Microsoft and Meta that exceeds $40 billion. The market, increasingly impatient, wants proof of returns rather than ever-larger expansion plans.

That tension between aggressive capital deployment and a skeptical investor base drives the wild swings. The 14-day RSI sits at a neutral 52.0, suggesting calm, but the 30-day volatility of 111.42 percent tells a different story — placing Nebius among Europe’s most turbulent large-cap stocks, a volatility profile more typical of cryptocurrencies than a company with a €48.44 billion market capitalization.

The gap between moving averages captures the same contradiction. The stock trades just 2.17 percent below its 50-day average of €199.35, yet sits 60.72 percent above its 200-day average of €121.34 — evidence of how far the shares have run, even after the recent pullback.

The Short Squeeze Waiting to Happen

Short sellers have taken notice. Short interest has grown from 50.93 million to 61.01 million shares, representing 28.55 percent of the free float — an unusually high figure for a company of this size. Every piece of news, good or bad, gets amplified by positioning rather than dampened. The bears have ammunition from the valuation: a price-to-earnings ratio of 70.83 and an EV/Sales ratio of 63.14, compared to a sector median of just 3.81.

The bulls counter with the volume of contracted demand and a track record of addressing financing questions. That pattern played out in textbook form recently: on a Thursday, the stock crashed 14 percent as investors punished an open funding question. The next day, Nebius announced a $775 million GPU-backed credit facility — secured by already-deployed infrastructure and cash flows from an investment-grade customer — and the shares jumped 8 percent. The facility, led by MUFG with a syndicate including ABN AMRO, Bank of America, Deutsche Bank, HSBC, Citi, Crédit Agricole, ING, Morgan Stanley, and Goldman Sachs, carries an interest rate of SOFR plus 2.50 percent and matures in October 2030.

Nvidia’s Vote of Confidence

Beyond the Nvidia stake, analyst sentiment has shifted decisively. Robert W. Baird upgraded Nebius to “Strong Buy” on July 23, while Northland Securities raised its price target to $410. The average analyst rating sits at “Moderate Buy” with a $222.15 price target, split among three “Strong Buy,” nine “Buy,” and five “Hold” ratings. The optimism is underpinned by quarterly results that crushed expectations: a loss per share of $0.23 versus the consensus estimate of -$0.81, and revenue of $399 million — up 684 percent year-over-year and above the $375.13 million forecast.

For the full year 2025, Nebius reported revenue of $529.8 million with operating income of $29 million, but a net loss of $446.7 million.

The Google Tailwind and Insider Headwind

Additional momentum came from Alphabet CFO Anat Ashkenazi, who announced that Google would increase its reliance on external data center capacity starting in the third quarter of 2026. Alphabet simultaneously raised its 2026 investment forecast from $180-$190 billion to $195-$205 billion — a signal investors interpreted as confirmation of demand for providers like Nebius.

Yet insider activity tells a more cautious story. The CEO sold 46,627 shares at $235.45, the CFO sold 1,509 shares at $276.20, and the CTO sold 16,937 shares at $235.45. Over the past three months, insider sales totaled 668,405 shares worth $140.4 million. The Swedish pension fund Andra AP fonden also reduced its position by 32.1 percent in the first quarter, leaving it with 35,254 shares. Institutional ownership stands at 21.90 percent.

The Technical Picture

The stock closed Thursday at €194.48, up 1.72 percent on the day. That leaves it 25.49 percent below its 52-week high of €261.00 from late June, and 2.39 percent below its 50-day moving average of €199.24 — trading just under that medium-term trendline despite a string of positive news around the Nvidia stake, analyst upgrades, and Google’s commentary.

The Vera Rubin NVL72 platform, which has been in full production since June and is also deployed at Google Cloud, Azure, OCI, and CoreWeave, gives Nebius a technical edge. But with investment plans in the tens of billions, a short interest approaching 30 percent, and a stock that swings like a cryptocurrency, the question remains whether the market’s patience will match the company’s ambition.