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AI Capacity Crunch: Nebius Soars on Demand
1 Dec, 2025
Summary
- Nebius rents AI-optimized data centers, currently sold out.
- The company secured massive deals with Microsoft and Meta.
- Analysts predict substantial revenue growth through 2027.
The AI market's rapid expansion is creating a bottleneck in data center capacity, positioning companies like Nebius for significant growth. Nebius rents out AI-optimized data center space, including specialized hardware and cooling solutions, for AI training and inference workloads. Demand has surged to the point where all current capacity is sold out, with new capacity already presold, granting Nebius considerable pricing power.
The company's recent financial performance underscores this demand. In Q3, revenue saw a remarkable 355% year-over-year increase, with its core infrastructure business achieving a 19% adjusted EBITDA margin despite heavy investment in global expansion. Furthermore, Nebius has solidified its market position through major five-year agreements with Microsoft, potentially worth $19.4 billion, and a $3 billion deal with Meta Platforms.
Looking ahead, analysts anticipate Nebius' momentum to continue, forecasting a jump in revenue from $554 million in 2025 to $5.8 billion by 2027. Despite a rich current valuation, the projected growth suggests substantial upside potential for investors, making it an attractive option amidst the AI infrastructure supply shortage.
