Here’s a not-so-big but interesting thing related to Nebius. 
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Nebiuks has another opportunity ahead of it, at least according to the tweet below?
Will Nebiuks become a company again that I think is too expensive, and then watch it double, ten-bag, hundred-bag, constantly wondering how expensive it is. 
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Yes, Nebius is a good candidate for that genre. An interesting end of the year is expected for Nebius. If the datacenter deals are postponed, meaning revenue falls below the 2025 promises, then the stock will dip 50% until those deals are secured in 2026 and the market gets excited again. Nebius is a “buy and forget” type of investment for me, thanks to Noredea who didn’t allow buying shares into a stock savings account, and thanks to Nordnet, whose trading fees I find quite high. Now I’ll just let the small position simmer peacefully there in Nordnet.
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Well, look at that, Nebiuksella has Mäntsälä on his mind, as was sung in an old song..
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This tweet provides a quick overview of Nebius, mentioning, among other things, how the company is a rapidly growing cloud service company benefiting from the AI boom and expanding internationally. Additionally, the tweet states that it has promising subsidiaries and a strong financial position, including Nvidia’s ownership stake.
https://x.com/meeijer/status/1941595443982729327
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At least a cool summer increases the competitiveness of the Mäntsälä unit, and hopefully we will get additional investments. @Sijoittaja-alokas and others, you have nicely compiled news / analyses here all the time. If I briefly summarize my own thoughts on Nebius here. It’s difficult to do traditional discounted cash flow (DCF) analysis for the company’s business, this is my opinion. Because even the datacenter business is, after all, dependent on so many things. But for me, Nebius is a statement on the triumph of AI in the near future as well. Practically the same predictability problem exists with all other AI-related companies. Investments are large across the entire AI field (AWS, MSFT, GOOGLE, NVDA, AMD etc…). And when investments are large, changes are also large, and demand at this Nebius level is difficult to predict. Nvidia’s relatively moderate valuation level (key figures are at a reasonable level) indicates that investors find it difficult to predict the future. The US stock market is now full of technology companies whose valuations are not justified by PE ratios. However, that doesn’t mean all companies are speculative lottery tickets. For Nebius, the most important key figure for me is the size of the cash balance relative to debt. It has consistently been strongly in the black.
For me, Nebius is an AI bet because the company is still enjoyable to follow. The fact that the company is enjoyable to follow means that one doesn’t get agitated by every piece of news or slight fluctuation. Because I don’t trade, but rather ride along. Even if Nebius isn’t the best AI infrastructure company, for me it’s probably good enough because I can stick with it. Agitation is expensive.
I have done my homework, and the company has substance. But the company does have a rather fragmented cluster of services. And probably the company’s market value is less than the sum of its parts separately. But this is just my gut feeling. With this, we proceed, with good investor spirits, riding with Nebius.
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Below is a tweet highlighting how the collaboration between Shopify and Nebius is a significant step, indicating that Nebius is ready for the next phase: AI adoption by large enterprises.
Previously, AI infrastructure was mainly utilized by startups, but now large companies are also modernizing their systems. In short, this company offers scalable, customized solutions that will be needed in the future.
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The tweet below states that Nebius is surprisingly building a new data center in the UK, which will increase the number of operational centers to six out of seven by the end of this year.
Growth is clearly expected.
https://x.com/family_remy/status/194374635540420841
Here is the link from the tweet:
https://group.nebius.com/newsroom/nebius-launches-in-uk-expands-britains-ai-infrastructure-with-nvidia-blackwell-ultra
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Below are a couple of tweets about Nebius, revealing, among other things, the following points.
If even 50 percent of Nebius’s GPU capacity is utilized by the end of 2025, the company will likely exceed its 750M–1B ARR guidance.
At 70 percent utilization, revenue could even double. Pricing is clearly more affordable than the company’s competitors.
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Goldman Sachs raised Nebius’s target price to 68 dollars. The stock is now in premarket +7.65% @$47.69.
!
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Here Jeff Davies explains how Nebius uniquely stands out from other neoclouds; they have their own LLM team led by Boris Yangel, who is a top expert in AI research. The company builds the entire cloud infrastructure itself and also leverages its own hyperscaler background. Their AI R&D team acts as its own tester, which enables rapid development, proper optimization, and a clear competitive advantage in AI-based services.
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It’s nice to have information about this company in Finnish. Some of this is familiar, especially the basic information, but I think it’s a well-done piece.
"However, analysts consider risks to include, among other things, the company’s continuous unprofitability, large capital investments, and potential stock dilution risks, should the company’s new billion-dollar convertible bonds convert into shares in the future.
Despite these risks, analysts have strong faith in Nebius Group’s potential to become a leading company in the AI cloud market, provided that growth continues at the same pace and strategic goals are met."
Subheadings:
- Collaboration with leading companies in the industry
- Giant bank initiated coverage of Nebius
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I think the same, it’s nice to read a Finnish interpretation of Nebius. The pros and cons from analysts are quite vague considerations, which is understandable, as Nebius in its current structure is about a year old. As I pointed out in the thread’s opening, Nebius’s core is still based on a Russian-background team that moved to the Netherlands. Arkady Volozh led his Moscow-based company far “during peacetime.” My investment thesis is based on Arkady as a founder-owner and leader, and on the idea that the core team’s “unconventional” background can produce solutions that deviate from the mainstream. And Jensen Huang and Arkady Volozh have a long business partnership behind them, dating back to their Yandex days. This is a special company.
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Nebius’s stock price has risen quite rapidly since spring, and there seem to be high growth expectations in the background, but investor enthusiasm has been calmer for a moment now. On the other hand, in my opinion, there has been quite a bullish sentiment regarding Nebius from investors for a long time; perhaps overly enthusiastic, and considering everything that has come up, I think the downsides and threats have been discussed too little. Of course, the pros and cons that have been thoroughly discussed from every angle are no longer as interesting, unless something new has emerged that would change them.
I, for example, wonder how the guidance might be updated. What do you specifically follow in Nebius’s Q2 report, and do you expect any surprises, one way or another? I’m probably most interested in what they say about the future and other things.
The significant stock price increase and certain uncertainties make me a bit nervous; I don’t own shares yet, but it’s under consideration.
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Collaboration with e.g. Nvidia, Microsoft, and OpenAI brings credibility, and the fact that the company builds its own data centers and GPU clusters brings cost-effectiveness, but despite the aforementioned, I am concerned about the money going into growth, which is burning quite a bit. Of course, there is a fair amount of cash, but for how long? Does the threat of dilution hover over growth? That, at least, is something I pay attention to, i.e., what the company comments on regarding this in connection with the earnings report. Well, analysts are at least confident with their buy recommendations and target prices.
I lightened my position some time ago, taking profits, as there had been a nice rise. The average price of my position in the portfolio is $47, and I am not buying or selling anytime soon - unless something significant happens in one direction or another. In the longer term, I am optimistic, and perhaps after the earnings report, I might consider adding to the position.
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https://seekingalpha.com/article/4803894-nebius-q2-a-moment-of-caution-downgrade
Q2 is likely on July 28th. According to the article’s author, caution is warranted because there is a lot of uncertainty associated with the earnings report. It’s worth reading the article and the justifications!
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I’m interested in the balance sheet situation; I hope the company remains net debt-free. This “rule of thumb” feels too simple to be true. But during my short US investment history (5 years), this rule has guided me to good paths. Nebius’s challenge is the significant investments ahead. That’s why it has to dilute its share capital, i.e., make share issues. But Nebius doesn’t invest speculatively, but based on orders. So, I personally prefer share dilution over more debt.
For Nebius’s US investments, I hope for swiftness, and I’d like more information, at least from the investor call. It’s worth following the Trump administration’s AI Act, and maintaining sufficient focus in the USA as well.
Other Q2 figures are quite insignificant to me; of course, the stock price will fluctuate a lot. I might even predict a dip because revenue might not grow enough, and the stock market will punish it. But then some news will come out that restores it to its previous level. This was just speculation.
The full report is here:
America’s AI Action Plan
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More thoughts from X. A very bullish text, but he commendably justifies his view.
More in the thread, but here’s a short excerpt from the beginning of his text, translated:
”In my opinion, Nebius is just getting started. This is not a story about chasing momentum. It’s a story about what happens when a company combines world-class engineering, customer-centricity, capital discipline, and full control, aiming to solve AI’s single biggest bottleneck: infrastructure.
No debt. Over $1.4 billion in cash. Absolutely no dependence on a single customer. And a founder who has built a multi-billion dollar platform before and is clearly doing it again.”
https://x.com/endicottinvests/status/1949132187539755091?s=61&t=kg4MSe8vnD_LCYHDqZSl2g
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Nebius has very strong ties to Israel. What do you think; how real is this Israel risk in the company’s case?
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Good point. Right off the bat, I’ll say my opinion is that it’s not a risk, but a good thing. Let me elaborate a bit. Israel has probably produced the most technology for the world relative to its population. For example, Mellanox, acquired by Nvidia in 2020, was Israeli. Many cybersecurity companies have Israeli backgrounds. Often, when it comes to Russians and IT, a network to Israel can be found. Morally speaking, politics and the IT business are two different things in my value system. I suspect that Nebius will do its biggest business towards the USA. And from that direction, it’s unlikely that an Israel risk would be raised.
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