Nebius Group just delivered the kind of quarter that resets expectations for European AI infrastructure — and the numbers are still sinking in. The company reported Q2 2026 revenue of $582 million, up 454% year over year, while annualized recurring revenue reached $3.0 billion at the end of June, up 58% quarter over quarter. Adjusted loss per share narrowed by 68% year over year as the AI Cloud segment posted a 50% adjusted EBITDA margin, up from 24% in Q4 2025.
| LIVE Price | $193.23 |
| Market Cap | ~$50B |
| Total Revenue (TTM) | ~$1.4B |
| ARR | $3.0B (+58% QoQ) |
| AI Cloud Adj. EBITDA Margin | 50% |
| 2026 Contracted Power | 5 GW |
| Q2 Adjusted Net Loss | -$33M (EPS -$0.12) |
| FY26 Revenue Guidance | $3.0–3.4B (reaffirmed) |
The Revenue Machine Is Scaling Faster Than Its Inputs
Revenue growth of this magnitude usually comes with a warning label: margins get crushed while capacity catches up. Nebius is running the opposite play. The AI Cloud's adjusted EBITDA margin roughly doubled in two quarters, evidence that the GPU fleet is filling up and operating leverage is kicking in. ARR of $3.0 billion — 58% higher than the March quarter — suggests the contracted base compounds even as new clusters come online.
The company's positioning is straightforward: rent the scarce thing. Every hyperscaler and AI lab on earth is competing for the same NVIDIA silicon and the same gigawatts. Nebius has locked up both — and its privileged relationship with NVIDIA — which disclosed a 9.3 percent stake in July, worth more than $4 billion — keeps its name near the top of the allocation queue.
Power Is the Real Story: 5 GW and Climbing
Management raised 2026 contracted power guidance to 5 gigawatts — a fivefold increase since August 2025 and well ahead of the 3.5 GW contracted as of the first quarter. The capacity footprint is expanding across the United States and Europe, with new sites coming online to serve both sovereign AI demand on the continent and the wholesale AI cloud market in North America.
That power pipeline matters more than any single revenue line. Utility interconnection queues in most Western markets stretch years into the future; a gigawatt portfolio is effectively a structural barrier to entry. Every additional GW Nebius contracts today is capacity its competitors cannot build before 2028.
Guidance Reaffirmed, Momentum Unbroken
Full-year 2026 guidance was reaffirmed, with the company still on pace for roughly $3.0 to $3.4 billion in revenue this fiscal year — a sixfold jump from fiscal 2025. Management's framing after the print was unambiguous: AI infrastructure demand is just getting started.
That view is easy to dismiss as cheerleading until you look at who is buying. European enterprises running sovereign workloads, US AI labs desperate for power-locked capacity, and a management team that keeps raising its own targets and then beating them.
What Could Go Wrong
The bull case is loud, but the risks are real. Capex intensity is enormous: building 5 GW of capacity requires billions in annual spend, and the balance sheet carries the weight of that buildout. The company remains dependent on NVIDIA for silicon allocation — a cozy relationship, but one with a single point of failure. Competition is intensifying as every hyperscaler and a wave of AI cloud startups chase the same contracts. And with shares trading at a significant premium to the July report, valuation assumes the growth trajectory continues without a stumble.
For now, the market's verdict is clear: Nebius is compounding at hyperscale speed, and its bottlenecks — power and silicon — are the same bottlenecks constraining every AI buildout on earth. The company that secured both early is the one to watch.
Disclosure: The Signal holds no position in NBIS. Positions may change. This is not financial advice.
