Nebius: Record Growth Collides with $15 Billion Debt and a Rivalrous Client

AI infrastructure firm Nebius posts massive revenue jump to $399M, but shares tumble as Meta enters cloud market and debt surges to $15B.

Nebius is living a tale of two realities. The AI infrastructure provider just posted a staggering 684% revenue surge to $399 million in the first quarter of 2026, yet its stock has tumbled roughly 28% from a June peak of €261.00. Shares settled at €188.78 on Thursday, registering a weekly decline of nearly 11%. The disconnect between operational fireworks and market mood has one root cause: fear.

The biggest source of unease is Meta Platforms. The social media giant, which recently signed a five-year, $27 billion AI partnership with Nebius, now appears to be building its own cloud initiative, dubbed “Meta Compute.” The plan would let external developers tap Meta’s spare computing capacity, putting the company in direct competition with specialized cloud providers. While Nebius’s contracts with Meta are considered firm capacity reservations, investors worry that a large new entrant will compress margins over time. The timing is especially jarring given that the $27 billion deal was widely seen as a crown jewel in Nebius’s order book, which also includes a $17 billion pact with Microsoft.

That order book, totaling over $46 billion in contracted volume, has done little to calm nerves about the company’s balance sheet. Nebius’s total liabilities have ballooned more than 1,000% year-over-year to roughly $15 billion, driven by the enormous upfront cost of building out AI infrastructure. Management has raised its 2026 capital expenditure budget to as much as $25 billion — a figure that towers over the expected full-year revenue of no more than $3.4 billion. To fund the expansion, Nebius is turning to asset-backed financing secured by its contracts with Meta and Microsoft, as well as customer prepayments. Long-term borrowings have already doubled to $8.4 billion.

Despite the debt scare, the underlying business is humming. In the first quarter, adjusted operating profit swung to roughly $130 million from a loss a year earlier. The company ended the period with $9.3 billion in cash reserves, bolstered by recent convertible bond issues. Those cash buffers will be critical as Nebius accelerates the physical buildout: a new AI factory with 1.2 gigawatts of capacity is under construction in Pennsylvania, backed by $2 billion in support from Nvidia. The firm’s goal is to secure 4 gigawatts of power capacity under contract worldwide by the end of 2026.

Insider selling has added another layer of worry. Shares worth $132 million changed hands in recent transactions. Nebius has downplayed the moves, stating that CEO Arkadiy Volozh sold his shares solely to cover tax obligations. But the optics are awkward at a moment when the stock is grinding lower.

Technically, the sell-off has cooled an overheated rally. Nebius still trades roughly 62% above its 200-day moving average, and the relative strength index has settled at 42.6 — a neutral level after previous extremes. Year-to-date, the stock remains up about 145%, but the distance from its all-time high is a reminder of how quickly sentiment can shift.

Wall Street remains largely bullish. Fourteen analysts covering the stock have an average price target of $244, suggesting upside from current levels. Yet the path to that target is fraught. Nebius must prove that its physical infrastructure expansion can insulate margins from new software?layer competition — especially if the company’s most important client decides to become a rival.