Nebius Group (NBIS) Shares Soar 18.83% on $19.4B Microsoft AI Deal

Nebius Group (NBIS) shares surged to a new high on October 3, 2025, reaching their highest level since October 2025, with an intraday gain of 5.65%. The stock has rallied 18.83% over five consecutive days, driven by a landmark $19.4 billion multi-year agreement with Microsoft. This partnership, announced in late September, secures $17.4 billion in committed revenue through 2031 and positions Nebius as a critical player in the AI infrastructure sector.

The Microsoft deal underscores Nebius’ ability to attract high-profile clients, enhancing its credibility and scalability. The agreement aligns with broader industry trends, as hyperscalers like Microsoft aggressively expand AI cloud capacity to meet surging demand for generative AI and large language models. Analysts highlight that demand for AI computing resources remains “limitless,” with Nebius’ strategic partnerships and infrastructure capabilities placing it at the forefront of this growth.

Complementing the partnership, Nebius announced the purchase of 79 acres in Birmingham, Alabama, for $90 million. The site is expected to support new data centers with hundreds of megawatts of capacity, reinforcing its ability to meet client demands and compete with rivals. This expansion aligns with the company’s revised revenue guidance, which now projects annualized run-rate revenue of $900 million to $1.1 billion for 2025, reflecting strong momentum from the Microsoft deal and broader AI infrastructure trends.

While the AI infrastructure market’s long-term potential remains robust, challenges persist. The sector’s competitive landscape includes rivals like CoreWeave and Nvidia, with pricing pressures and capital-intensive projects posing risks. Additionally, Nebius’ reliance on major clients like Microsoft introduces concentration risk, as shifts in client spending could impact revenue. Despite these factors, the company’s $1.15 billion in recent financing and strong balance sheet provide flexibility to fund growth and R&D initiatives.

Looking ahead, Nebius’ stock performance hinges on its ability to sustain partnerships, scale operations, and navigate market dynamics. Analysts project hypergrowth, with revenue potentially reaching $3.2 billion by 2028, but execution and innovation will be critical to maintaining its position in the rapidly evolving AI ecosystem.