NBIS Stock Forecast & Price Target

Nebius Group has demonstrated substantial revenue growth, reporting total revenue of $146.1 million for the year, which represents a remarkable 237% year-over-year increase, highlighting the strength of its core business. The company's recent multiyear contract with Microsoft, valued at $17 billion, not only secures a high-quality backlog but also positions Nebius for significant future revenue growth, with potential annualized revenue run-rates projected between $7 billion and $9 billion by the end of CY26. Additionally, Nebius is anticipated to achieve double-digit returns on capital, bolstered by operational and structural efficiencies in its data center management, contrasting favorably with competitive benchmarks in the industry.

Nebius Group is projected to lower its revenue guidance to approximately $525 million for 2025 due to an inability to meet demand, raising concerns about the company's operational capacity and scalability. Despite a substantial revenue backlog exceeding $20 billion, the company's core business may be undervalued as it contends with challenges in attracting enterprise clients and maintaining profitability in a competitive landscape dominated by established hyperscalers. Furthermore, Nebius faces significant geopolitical and regulatory risks stemming from its origins as a subsidiary of Yandex, which could hinder its growth prospects and increase scrutiny from regulators.