Why Nebius Is Emerging as the Next Big Threat to Cloud Giants

Nebius Group N.V. (NBIS) is rapidly emerging as a disruptive force in AI infrastructure. The company has quickly transformed from a niche provider into a serious challenger to cloud giants. Its growth is powered by rising demand for GPU-as-a-service and sovereign AI. This article examines the recent catalysts and technical signals driving growth in Nebius. The stock has formed a bottom and continues to surge higher toward new record levels.

Recent Catalysts Driving Growth in Nebius

Nebius has gained strong momentum in the AI infrastructure space. Recently, it has emerged as a significant alternative to dominant cloud providers. Moreover, growing demand for GPU-as-a-service and sovereign AI capabilities has fueled adoption. As a result, enterprises and governments are increasingly shifting workloads to platforms that offer greater control and customisation.

A major catalyst came through Toloka, Nebius’s AI data labelling subsidiary. In May, Toloka secured $72 million in funding led by Jeff Bezos’s Bezos Expeditions. This investment validates Nebius’s growing role in AI training infrastructure. It also opens the door for deeper US market penetration, where AI governance and data localisation are top concerns.

The company has also made headlines for taking market share from CoreWeave. Industry analysts have noted that Nebius offers faster GPU deployment times and more flexible API integration. This positions it well as a developer-first platform, especially among startups building large AI models.

Geopolitical tensions are also fueling Nebius’s growth. As more countries pursue digital sovereignty, Nebius has emerged as a go-to option for localised AI compute. The company has gained attention in Europe and parts of Asia, where regulators prefer alternatives to U.S.-based cloud giants. This global trend provides Nebius with a unique edge in a rapidly shifting AI infrastructure landscape.

Strong Financial Performance Underpins Nebius Growth

Nebius posted a standout performance in Q2 2025. The company reported revenue of $105.10 million, marking a 625% increase year-over-year. This surge reflects accelerated demand for AI infrastructure, particularly in GPU-as-a-service offerings. The spike in quarterly growth also highlights strong execution and customer onboarding across multiple regions.

The company raised its annual run-rate revenue (ARR) guidance to a range of $900 million to $1.1 billion. This upward revision signals management’s confidence in sustained demand. It also reflects a robust pipeline of enterprise and public-sector clients shifting to Nebius for high-performance compute. The updated guidance shows Nebius is transitioning from rapid scale-up to long-term monetisation.

The company also achieved positive Adjusted EBITDA in the core business. This result shows the business model is scalable and efficient. Moreover, achieving profitability at this stage of growth is rare in the AI infrastructure space, making Nebius a standout among emerging players.

Another strategic move is the company’s push to secure over 1 gigawatt of power capacity by the end of 2026. This plan is critical to meet rising compute demand from hyperscale clients and sovereign AI projects. It shows long-term vision and capital allocation aligned with infrastructure-heavy expansion.

On the other hand, the equity structure remains well-capitalised. As of June 30, 2025, Nebius had over 238 million shares outstanding, excluding treasury shares. This setup gives Nebius room to reward talent and pursue acquisitions without immediate dilution risk. The financial foundation looks strong heading into the second half of the year.

The net income for Nebius has soared to $502.5 million in Q2 2025. After a prolonged period of modest and volatile income, the company posted a dramatic spike in profitability. This surge indicates substantial operational leverage from increased AI infrastructure demand.

Technical Analysis: Nebius Stock Shows Strong Bullish Momentum

Nebius Long-Term Patterns Indicate Strength

The price action for Nebius shows strong bullish momentum. The stock is approaching record levels, supported by a series of historically significant technical patterns. Over the years, the price has repeatedly formed bullish setups that led to major upward moves.

A notable triple bottom pattern appeared on the monthly chart in June 2013, with the neckline at $27.08. This neckline was broken upside down, and initiated a surge to a high of $45.42 in January 2014. Following that peak, it declined to mark a bottom at $9.94 in August 2015.

From there, Nebius has formed an inverted head and shoulders pattern. After breaking the neckline of this pattern, the stock rallied sharply to a high of $44.49 in February 2018. The price then entered a broad consolidation between $25 and $43, building another strong bullish base. A breakout from this zone eventually pushed the stock to an all-time high of $87.11 in late 2021.

However, a steep correction followed, wiping out prior gains and pushing the stock back to 2015 levels. From 2022 to 2024, Nebius remained suppressed due to trading halts and restructuring. In 2025, the stock staged a strong reversal. The bullish price action from April to July signals that momentum has returned. If the trend holds, NBIS is well-positioned to retest and potentially break above its record highs.

Nebius Weekly and Daily Charts Confirm Upside Potential

This positive price action is also observed on the weekly chart, which shows the formation of a double bottom pattern at the support level of an ascending broadening wedge.

The wedge pattern confirms that the double bottom has formed along its rising support trendline, signalling potential for further upside. Based on this structure, prices are likely to continue trending higher. The key resistance for Nebius lies near the $100 level, as indicated by the red trendline on the chart.

The daily chart for Nebius shows a well-formed double bottom pattern. The breakout above the $52 level confirmed this bullish setup. This breakout signals strong upward momentum and suggests that the stock may continue to trade higher toward the $100 region.

High Valuation, Higher Potential: Why Nebius Deserves Attention

Nebius currently trades at a P/S ratio of 67.58. This is far above the US tech sector average of 8.7. Based on this ratio, the stock looks expensive. However, its explosive growth helps justify the premium valuation. Nebius still offers better value relative to its growth potential compared to many AI peers.

Moreover, forward-looking valuation metrics are more favourable. As revenue expands, Nebius’s sales multiples are expected to decline sharply. This reflects investor confidence in the company’s ability to scale quickly. The expected sales momentum will help normalise its valuation over time.

Nebius benefits from strong industry tailwinds. The cloud infrastructure-as-a-service market is expected to grow at nearly 21% annually through 2032, and Nebius is already outpacing that rate. Its aggressive capacity expansion could establish it as a leading player in the market. This long-term opportunity supports further upside, even from current elevated levels.

The chart below shows that Nebius posted a substantial quarterly net income, far outperforming its peers. While Gen Digital Inc. (GEN) reported profits, Rubrik Inc. (RBRK) remained in the red with a significant loss. This profitability gap highlights Nebius’s superior scalability and supports its premium valuation despite a high price-to-sales ratio.

Key Risks Facing Nebius

Despite strong momentum, Nebius faces geopolitical uncertainty. The company benefits from global demand for sovereign AI solutions, but it operates in a highly fragmented regulatory landscape. Rising tensions between the US, Europe, and Russia could lead to sanctions or export restrictions that affect partnerships and supply chains.

Another concern is power infrastructure. Nebius plans to secure over 1 gigawatt of capacity by 2026, but execution risk remains high. Delays in energy procurement, grid approvals, or facility buildouts could constrain growth and weaken investor confidence. This is especially critical as hyperscale clients demand uninterrupted compute availability.

Finally, competition in AI infrastructure is increasing. Major players like Amazon (AMZN), Microsoft (MSFT), and CoreWeave, Inc. (CRWV) are rapidly scaling GPU offerings. Moreover, the pricing pressure and shorter hardware cycles could erode margins. If Nebius fails to maintain its performance edge or speed of deployment, it risks losing clients to more established cloud rivals.

Conclusion: Nebius Is Turning Into a Cloud Giant Challenger

Nebius is not just another AI infrastructure startup; it is already forcing cloud leaders to react. Its sovereign AI focus and faster GPU deployment have pulled clients away from CoreWeave and made it a credible alternative to AWS and Azure. Nebius has delivered revenue growth and profitability, which underscores its scalability. This financial strength signals that Nebius is building the resources to compete at the highest level.

From a technical perspective, Nebius stock is flashing strong bullish signals. Moreover, the confirmed double bottom breakout above $52 points to renewed investor conviction, with momentum building toward the $100 resistance zone. In addition, this technical strength mirrors its fundamental growth story, making Nebius stand out in a crowded AI market. Therefore, investors can consider buying Nebius stock at current levels and adding more positions if the price pulls back, with a target near $100.