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The Nebius Group is focused on building AI technology infrastructure.
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Recently, the company partnered with Microsoft as a client.
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To support its growth, Nebius has taken on nearly $1 billion in debt.
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10 shares I like more than the Nebius group›
The growth of artificial intelligence (AI) is presenting substantial opportunities for businesses and investors alike. Nebius Group (NASDAQ: NBIS) stands to gain from this trend.
In fact, the AI infrastructure provider has seen its shares skyrocket over 250% for the week ending September 19, 2025, largely fueled by the increasing demand for AI computing power.
But is now the right time to buy in, especially when stock prices are at a 52-week peak?
Nebius Group emerged from Yandex, a prominent Russian search and tech firm. However, post-Ukraine invasion, the company severed ties with Russia. Now, its primary focus is on high-performance cloud computing AI systems.
In addition to this, the company owns Avride, which develops self-driving vehicles and robotics, as well as Tripleten, an educational tech firm. The financial performance of these segments remains uncertain, however.
By strategically embracing AI, Nebius has managed to capitalize on the insatiable demand for computing power within the tech sector. This resulted in second-quarter sales soaring by an impressive 625% year over year, totaling $105.1 million.
Nebius’s founder and CEO, Arkady Volozh, remains optimistic, stating, “I hope that the fundamental trends in our space will continue to drive growth for years to come,” and he’s not alone in this sentiment.
A year ago, NVIDIA’s CEO Jensen Huang emphasized the necessity for AI-specific infrastructure, like what Nebius provides. He refers to it as an “AI Factory,” defining the ability to analyze data and make informed conclusions.
Acknowledging the urgent need for advanced computing, Microsoft recently inked a multi-year deal with Nebius worth billions, which is expected to substantially bolster revenue once it takes effect later this year.
In light of the rising demand for AI, Nebius is quickly working to expand its capacity and establish more data centers. But, expanding AI infrastructure doesn’t come cheap—capital expenditures jumped to $91.5 million in the second quarter, marking a 49% increase year-over-year. The company’s second-quarter balance sheet now shows nearly $1 billion in debt, a significant rise from just $6.1 million at the end of 2024.
Additionally, the company’s second-quarter expenses surged to $226.3 million from $126.7 million the previous year. This led to a significant operating loss of $111.2 million for the quarter, though net income was reported at $584.4 million, primarily due to gains from securities investments.
To support its growth ambitions, Nebius has initiated a share offer, contributing to its gross revenue as of September 15. This move is aimed at enabling further operational expansions while revenues continue to climb.
As the AI industry continues to evolve, the revenue potential for Nebius’ infrastructure operations could further increase. Forecasts suggest the AI market could grow from $244 billion in 2025 to $1 trillion by 2031.
Nevertheless, even though Nebius seems like a promising investment opportunity, its stock valuation warrants careful consideration, particularly after partnering with Microsoft. Let’s take a closer look at the price-to-sales (P/S) ratio.
This metric indicates how much investors are willing to pay for each dollar of revenue generated over the past year. When comparing it to CoreWeave, a competitor in the AI infrastructure sector that recently launched and also counts Microsoft as a client, some interesting insights emerge.
The P/S chart indicates that Nebius’s stock is pricier than CoreWeave. Furthermore, it appears that the anticipated revenue growth from the Microsoft partnership is already reflected in Nebius’s stock price.
While Nebius offers an exciting AI investment opportunity, its high stock valuation coupled with rising debt might make it a risky venture at this point. Hence, it seems advisable for only those with a higher risk tolerance to consider investing, and perhaps wait for a potential dip in stock price.
It’s definitely something to ponder before buying stocks in Nebius Group.
The analyst team at Motley Fool Stock Advisor has identified several other stocks that they believe could be more advisable for investors to consider now, with Nebius Group not making the list. The stocks they recommend could lead to phenomenal returns in the coming years.
As a point of reference, if one had invested in Netflix back when it was first mentioned in their list, a $1,000 investment would now be worth over $657,000. Similarly, an early investment in NVIDIA would have returned over $1 million, based on their return metrics.
It’s also worth noting that Stock Advisor boasts an average return of 1,064%—a stark contrast to the S&P 500’s 190% over the same period. Don’t miss out on their latest recommendations by checking in with Stock Advisor.
*The Stock Advisor returns are as of September 22, 2025.
There are positions in Microsoft and Nvidia as noted by Robert Izquierdo, and Motley Fool recommends new options for both companies as well. They also recommend Nebius Group but with caution regarding stock purchases.
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