Nebius Raises Power Guidance to 5 Gigawatts Amid AI Expansion

Nebius increased its contracted power capacity guidance for the end of 2026 to 5 gigawatts, up from 3 gigawatts in February and 4 gigawatts in May. The neocloud provider is expanding data center sites across North America and Europe to meet AI capacity demands for hyperscalers such as Microsoft and Meta Platforms.

A major agreement with Meta Platforms involves deals totaling $27 billion over five years, with capacity delivery starting in early 2027. This partnership is expected to generate over $5 billion in annual recurring revenue. To fund the construction of data centers and hardware procurement, the company issued $4 billion in private convertible notes earlier this year and expects capital expenditures between $20 billion and $25 billion in 2026.

Financial growth has been rapid, with second-quarter revenue reaching $582.3 million, a 454% year-over-year increase. Nebius projects full-year revenue between $3 billion and $3.4 billion, roughly quadruple its 2025 figures. While the company's stock has risen over 200% this year, some analysts warn that increased GPU capacity from competitors like Nvidia and CoreWeave could eventually erode its pricing power and margins.