Nebius closed 2025 with astonishing top-line expansion and its first quarter of positive adjusted EBITDA—but at the cost of massive capital intensity and depreciation. Demand remains well ahead of capacity, the ARR run-rate has leapt past the company’s prior outlook, and strategic build-outs (including a new data center in France) keep the flywheel spinning. The near-term debate is less about growth and more about how quickly unit economics scale while billions in capex flow through D&A.
What jumped out
Explosive revenue growth with a first EBITDA inflection. Q4 revenue landed at $227.7 million, up 547% year over year and 56% sequentially. For full-year 2025, revenue reached $529.8 million—a 479% YoY surge. Critically, Nebius posted $15.0 million of adjusted EBITDA in Q4, marking its first positive quarter on that metric at the Group level. Core AI cloud contributed $51.8 million of adjusted EBITDA at a 24% margin in the quarter. These results reflect a business running at peak utilization and effectively sold out in Q4.
ARR smashed guidance. Annualized run-rate revenue hit $1.25 billion as of December 2025, above the $900 million to $1.1 billion outlook and more than double the $551 million run rate at end-September. That acceleration tees up 2026 capacity additions as the key swing factor for both growth and margins.
Segment mix shows what’s pulling the train. Core AI cloud revenue was $214.2 million (about 94% of Q4 group revenue), while TripleTen contributed roughly 6%; Avride’s contribution was immaterial. This concentration underscores just how central GPU-rich AI infrastructure is to Nebius’ model today.
Gross-level operating leverage is real. Cost of revenue rose to $68.5 million, but as a percentage of revenue fell to 30% from 60% a year ago—evidence that scale and utilization are bending unit costs. SG&A rose in dollars but declined to 70% of revenue from 243% last year; product development dropped to 23% from 91% on the same relative basis. The counterweight: depreciation and amortization ballooned to $180.7 million in Q4 as GPU and data-center investments begin their accounting life.
Capex remains the headline. Q4 capex ran at roughly $2.1 billion, driven by GPUs, related hardware, and greenfield sites. Management says it has already secured >2 GW of contracted power and is targeting >3 GW by end-2026—an audacious build plan that, if hit, should structurally expand capacity and revenue headroom.
Strategic and governance notes. Nebius plans to recommend Deloitte & Touche LLP as its independent auditor for the year ending December 31, 2026—an incremental sign of maturing public-company processes.
Why this quarter matters for Nebius
Demand > supply remains the thesis. Nebius’ AI cloud stayed capacity-constrained in Q4, a dynamic that supports pricing and utilization as new racks energize. It also validates the company’s earlier “whales” strategy: multi-year infrastructure agreements like the previously announced deals with Microsoft and Meta Platforms help underpin forward visibility, while the order book encourages aggressive capex scheduling.
Geography and power security are competitive weapons. On February 12, Nebius unveiled plans for a 240MW data center in Béthune (near Lille), repurposing a former factory site. European siting, industrial-scale power, and staggered phase-ins should diversify footprint risk and support deal-flow with enterprise and hyperscale buyers seeking proximate compute. It’s one of the largest such campuses in Europe on paper.
The P&L will lag the buildout by design. With server lives currently depreciated over four years, the D&A line will stay heavy while revenue ramps into newly installed capacity. In the meantime, early proof of quarterly adjusted EBITDA profitability is important—it shows the core cloud engine can print margin once racks are humming, even if consolidated GAAP profitability takes longer under capex gravity.
The bear case, fairly stated
- Execution and supply risk. The model assumes tight construction timelines, GPU deliveries, and grid hookups across multiple geographies. Any slippage crimps ARR conversion and delays margin scaling.
- Capital intensity and financing. Sustained multi-billion-dollar capex needs recurring access to capital and careful balance-sheet management. Rising D&A depresses operating margins in the interim.
- Price compression risk. As AI compute supply broadens industry-wide, spot pricing power could normalize faster than expected, pressuring mid-cycle margins unless efficiency offsets keep pace.
- Customer concentration. Large contracts concentrate revenue and operational focus; a single delay or renegotiation can swing quarterly prints.
The bull case, equally fair
- Structural demand. Model builders and enterprises continue racing to train and serve larger models—fostering secular demand for high-density, well-powered GPU clusters.
- Contracted visibility. Multi-year agreements with blue-chip counterparts provide a floor under utilization while new campuses spin up.
- Operating leverage in motion. Q4’s halving (and more) of key opex ratios vs. revenue illustrates the playbook: absorb fixed costs now, monetize at scale later.
- European beachhead. The Béthune build could become a strategic magnet for EMEA demand, with brownfield redevelopment accelerating time-to-capacity.
Stock setup
Ahead of the call, the stock is reacting to a mix of “beat on growth, miss vs. Street on top-line and EBITDA” headlines, while traders parse capex cadence and 2026 power targets. Intraday, the shares are volatile around the print; the path from “sold-out” to “scaled profitability” will hinge on how quickly new megawatts translate to recognized revenue and margin expansion. (Live chart above.)
What to listen for on the call
- Capacity timeline: specific energization dates, MW by campus, and expected utilization ramps quarter-by-quarter.
- Pricing and contract mix: fixed vs. variable economics, renewal dynamics, and any signs of price normalization.
- D&A policy: useful life assumptions for servers and network equipment—and whether any changes are contemplated as architectures evolve.
- Working capital and cash: Q4 operating cash flow was strong; how does that trend as capex stays elevated?
- Segment strategy: trajectory for TripleTen and Avride relative to core AI cloud, including capital allocation thresholds and profitability milestones. (Partnerships with Uber can help Avride distribution, but financial contribution remains small today.)
Conclusion on Nebius
Nebius exits 2025 as a classic hypergrowth infrastructure story: demand outstripping near-term supply, contracts in hand, and a capex schedule that would make even hyperscalers blink. Q4’s first positive adjusted EBITDA is a line in the sand; now the task is to stack quarters of improving margins while thousands of new GPUs come online. If management executes on >3 GW of contracted power and keeps utilization tight, the model should compound quickly. If not, D&A and financing costs will test investor patience. For now, the momentum—and the math—remain on Nebius’ side.
FAQ
What were Nebius‘ key Q4 numbers?
Revenue $227.7M (+547% YoY), adjusted EBITDA $15.0M (first positive quarter), core AI cloud $214.2M (~94% of revenue).
What is Nebius’ ARR now?
$1.25B as of December 2025, above the prior $900M–$1.1B outlook.
Why is depreciation so high?
Years-long depreciation of rapidly expanding GPU and data-center assets ($180.7M D&A in Q4) drags reported operating profit even as adjusted EBITDA turns positive.
Is Nebius adding capacity in Europe?
Yes—planning a 240MW campus in Béthune, near Lille, with phased capacity starting in late summer 2026.
Who are some notable ecosystem partners?
Multi-year agreements with Microsoft and Meta Platforms support forward utilization.
Disclaimer
This article is for informational purposes only and does not constitute investment advice, an offer, or a solicitation to buy or sell any securities. The analysis reflects the author’s opinion at the time of writing and may change without notice. Investing in equities, particularly in rapidly evolving sectors like AI infrastructure, involves risk, including loss of principal. Conduct your own research or consult a qualified financial advisor before making investment decisions.
