Image Source: CNBC
NBIS stock fell sharply Thursday after Nebius delivered stronger-than-expected third-quarter revenue but issued a cautious outlook and sharply increased its capital spending plans. Shares dropped about 10% in premarket trading, reversing part of a powerful rally earlier in the week.
The selloff highlights the growing tension in the artificial intelligence infrastructure market. Demand for computing power remains strong, but investors are increasingly focused on the enormous cost of building data centers, expanding capacity and financing long-term growth.
NBIS Stock Slides After Nebius Raises Capital Spending Forecast
Nebius reported third-quarter revenue of $980.8 million, surpassing the LSEG consensus estimate of $907.5 million. Revenue surged 571% from the same period a year earlier, reflecting rapid expansion in the company’s cloud computing and AI infrastructure operations.
The company reported a net loss of $37.5 million, or 13 cents per share, compared with a net loss of $119.6 million, or 50 cents per share, in the prior-year quarter. CNBC noted that it was not immediately clear whether the reported loss per share was directly comparable with the 69-cent analyst expectation.
Despite the revenue beat, investors reacted negatively to Nebius’ forward guidance. CEO Arkady Volozh said the company expects fiscal 2026 revenue to land at the low end of its previously stated range of $3 billion to $3.4 billion. FactSet had expected full-year revenue of approximately $3.35 billion.
Explosive AI Growth Comes With a Bigger Price Tag
Nebius expects fiscal 2026 capital expenditures to reach $27 billion, above its earlier forecast of $20 billion to $25 billion and higher than the FactSet estimate of $23.85 billion.
The company’s initial 2027 outlook also raised eyebrows. Nebius projected revenue of $12 billion to $13 billion while forecasting capital expenditures between $40 billion and $45 billion. That spending range was well above the FactSet expectation of $28.77 billion.
Volozh described the 2027 revenue outlook as conservative, saying it reflects a measured approach to the pace of the company’s buildout. However, the scale of the planned investment has intensified concerns about debt, cash requirements and the timing of returns from new data center capacity.
- Third-quarter revenue: $980.8 million
- Year-over-year revenue growth: 571%
- Fiscal 2026 revenue outlook: Low end of $3 billion to $3.4 billion
- Fiscal 2026 capital expenditure forecast: $27 billion
- Fiscal 2027 capital expenditure forecast: $40 billion to $45 billion
Neocloud Stocks Face Renewed Volatility
Nebius’ results came after fellow neocloud companies CoreWeave and IREN posted better-than-expected financial results over the past week. Those reports helped revive investor enthusiasm after a difficult month for AI infrastructure stocks.
On Wednesday, CoreWeave surged nearly 25%, while Nebius gained 15%. Applied Digital rose more than 7%, and IREN added almost 6%. The group reversed course Thursday after Nebius’ report, showing how quickly sentiment can shift across the sector.
CoreWeave has also faced questions about financing costs. Its bond yields recently climbed above 16%, although the company said it expects to keep parent-level debt financing below $5 billion through 2027.
For NBIS stock investors, the comparison with rival neocloud providers is significant. These companies are racing to secure chips, power and data center space, but their aggressive expansion requires substantial borrowing and long-term customer commitments.
Political and Nvidia Risks Add Pressure
The broader political environment is creating another challenge. U.S. voters recently supported dozens of ballot initiatives restricting data center development, while Democrats won sweeping victories in both chambers of Congress. New restrictions could complicate permitting and slow the construction of facilities needed to support AI workloads.
Nvidia is another source of uncertainty. The chipmaker has invested across the neocloud industry and helped support some projects. A regulatory filing showed Nvidia held approximately $329 million in Nebius shares at the end of June.
CNBC also reported that Nvidia’s board could seek to remove co-founder and CEO Jensen Huang following revelations about alleged affairs, including one involving an alleged Chinese spy. The developments have added volatility to Nvidia and companies connected to its AI ecosystem.
During the quarter, Nebius said it raised $5.75 billion in debt financing. That funding may help support its expansion, but it also underscores why markets are closely watching borrowing costs, cash flow and customer demand.
What Investors Are Watching Next
The company’s earnings call with analysts is expected to provide more detail about its construction schedule, financing strategy and customer commitments. Investors will also be listening for evidence that AI demand remains strong enough to justify the increased spending.
The latest move in NBIS stock does not erase Nebius’ impressive revenue growth. Instead, it shows that the market is demanding proof that fast expansion can eventually produce sustainable profits. Until that confidence returns, the shares may remain highly sensitive to earnings guidance, debt markets and developments across the AI sector.
FAQs About NBIS Stock
Why did NBIS stock fall?
NBIS stock declined after Nebius issued a cautious 2026 revenue outlook and raised its capital expenditure forecasts for 2026 and 2027, despite beating third-quarter revenue expectations.
How much revenue did Nebius report?
Nebius reported third-quarter revenue of $980.8 million, up 571% year over year and above the $907.5 million analyst consensus estimate.
What is Nebius’ 2026 capex forecast?
Nebius expects fiscal 2026 capital expenditures of $27 billion, above its previous guidance of $20 billion to $25 billion.
What is Nvidia’s connection to Nebius?
Nvidia has invested in the neocloud sector and held approximately $329 million in Nebius shares at the end of June, according to a regulatory filing.
Is NBIS stock volatile?
Yes. NBIS stock has experienced significant swings as investors assess AI demand, data center construction, financing costs, political restrictions and the sustainability of the industry’s expansion.
