Nebius Up 40% in 3 Months: Should Investors Buy or Hold Now?

Nebius Group N.V. NBIS stock has gained 40.4% in the past three months, outperforming the Zacks Computer & Technology sector and the Zacks Internet Software Services industry’s decline of 2.5% and 7.9%, respectively. The S&P 500 composite is down 1.9% over the same time frame. The company’s shares have soared 10.8% in a month.

Shares of NBIS have surged 12% since the recent announcement of NVIDIA Corporation’s NVDA $2 billion investment on March 11, 2026, to jointly develop next-generation hyperscale AI cloud infrastructure.

NBIS has outpaced its peers, Microsoft Corporation MSFT and CoreWeave, Inc. CRWV, with MSFT falling 14.7% and CRWV climbing 14.4% during the same interval.

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Following a strong rally, investors may wonder whether NBIS still has upside or if expectations have outpaced fundamentals. Let’s break down to see what’s driving the rally, the bull and bear cases, and a practical approach to managing risk and position size.

NBIS’ Growth Catalysts

NBIS received a major boost after NVIDIA announced a $2 billion investment. The partnership strengthens collaboration across the AI technology stack, supporting Nebius’ full-stack AI cloud platform for AI-native companies and enterprises, while helping the company scale toward its goal of deploying more than 5 gigawatts of AI computing capacity by 2030 with access to next-generation GPUs. The partnership also includes deploying multiple generations of NVIDIA hardware across Nebius’s platform, including early adoption of advanced computing architectures such as NVDA’s Rubin platform, Vera CPUs and BlueField storage and networking systems.

In the fourth quarter of 2025, the company accelerated its capacity plans, announcing nine new data centers and securing more than 2 gigawatts of contracted power, with expectations to exceed 3 gigawatts. Nebius remains on track to deliver 800 megawatts to 1 gigawatt of available data center capacity by year-end 2026.

Recently, Nebius received approval from the Independence City Council for a Chapter 100 industrial development incentive plan to build a large AI factory campus in Independence. The proposed 400-acre facility could support up to 1.2 gigawatts of capacity, making it the company’s largest AI site in the United States and a key part of its U.S. expansion strategy.

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Nebius continues to see robust demand across large accounts, hyperscalers, AI start-ups and enterprise customers. AI-native companies are scaling rapidly, with customers increasing GPU usage from hundreds and thousands to tens of thousands. Demand continued to exceed supply, with the company once again selling out its capacity in the fourth quarter, while operating leverage and cost management supported improved profitability.

In fourth-quarter 2025, the company’s core AI cloud business remained strong, with revenue surging 830% year over year and 63% sequentially, driven by high utilization, favorable pricing and disciplined execution. Enterprise clients are expanding AI adoption across critical business processes, leading to larger and longer contracts. The pipeline continues to grow, and new customer contract durations increased 50%. The company is seeing continued strength in pipeline growth, improving deal trends and solid progress in its vertical strategy. Pipeline creation is on track to exceed $4 billion in the first quarter of 2026, and management expects further expansion as capacity increases and sales coverage broadens. Deal metrics are strengthening, with longer contract durations and larger average deal sizes.

Apart from these, Nebius’ growth is supported by the expansion of the AI cloud platform through organic development and acquisitions. The launch of Token Factory and Aether releases, along with the acquisition of Tavily, enhances platform capabilities and developer engagement. Software attach rates are 100% for AI cloud customers. Moreover, the company has multiple financing options, including operating cash flows, debt financing, asset-backed financing, potential equity issuance and stakes in non-core assets such as ClickHouse and Avride.

On the last earnings call, the company stated that it delivered the first tranche of its Microsoft commitment on time in November and that the remaining capacity tranches remain on schedule for deployment across 2026, with the majority expected to be delivered in the second half of the year. Nebius expects Microsoft to contribute revenue at its full annual run rate beginning in 2027, following the deployment of all tranches.

Nebius Group N.V. Price and Consensus

Nebius Group N.V. price-consensus-chart | Nebius Group N.V. Quote

However, NBIS operates in a dynamic environment driven by macroeconomic uncertainty, rising operating expenses and significant capital requirements. The company plans to invest between $16 billion and $20 billion in capex in 2026 to expand its AI infrastructure. While this supports long-term growth, such elevated spending could increase financial risk if revenue growth does not keep pace with the company’s capital-intensive expansion strategy, particularly amid potential fluctuations in AI demand, competitive pricing pressures and evolving regulatory conditions. Additionally, the rapid rollout of multiple data centers across regions introduces execution risks.

Moreover, Nebius expects EBIT to remain at a loss in 2026 as the company continues executing its capacity expansion plans, deploying GPUs and investing in research and development to significantly strengthen its technology stack and future AI products.

Along with NBIS, peers are grappling with rising capital expenditures. CoreWeave has been funding its expansion strategy through significant leverage, raising about $18 billion in debt and equity in 2025 alone. CoreWeave also expects capital expenditures to reach $30-$35 billion in 2026 as it continues to scale its AI infrastructure.

A Look at NBIS' Valuation

In terms of Price/Book, NBIS’ shares are trading at 5.9X, higher than the Internet Software Services industry’s 2.91X.

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Should You Buy or Hold Now?

Despite near-term headwinds and valuation concerns, the company continues to benefit from strong long-term growth drivers.

Existing investors may consider holding their positions, while prospective investors may wait for a more favorable entry point.

At present, NBIS carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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