Discover if Nebius Group Could Be Your Millionaire-Maker Stock
Nebius Group (NBIS) is emerging as a significant player in the European artificial intelligence (AI) sector. Since the beginning of 2025, the company has experienced a remarkable share price surge of 390%. However, the question remains: can Nebius be your millionaire-maker stock?
Nebius Group Overview
Nebius was formed as a rebranded entity after Yandex, a Russian multinational, was severely impacted by sanctions following Russia’s invasion of Ukraine in 2022. To adapt, Yandex divested its Russian operations and redirected its focus to Western European markets.
Unlike Yandex’s previous diversified model, Nebius specializes in AI infrastructure and cloud computing. It operates extensive clusters of graphics processing units (GPUs) to offer computing power to startups and enterprise clients.
Recent Growth and Financial Performance
The company has seen explosive growth, especially in its second-quarter revenue, which rose by 625% to reach $105.1 million. This surge is driven by increased demand for AI infrastructure.
Expansion Plans
Nebius plans to enhance its growth through significant capital expenditures (capex), focusing on expanding its data center presence globally and acquiring advanced AI chips from suppliers such as Nvidia. Additionally, the company is exploring synergistic opportunities beyond its core offerings.
Investments in Autonomous Mobility
One of Nebius’s subsidiaries, Avride, is venturing into autonomous mobility, focusing on self-driving cars and delivery robots. This division has partnered with Uber Technologies to offer services in various U.S. cities. However, experts caution that this initiative may still resemble an experimental venture, potentially lacking immediate growth prospects.
Competitive Landscape
Nebius faces stiff competition within the autonomous mobility sector from established companies like Waymo and Tesla. In the cloud computing arena, Nebius competes with major American players like Alphabet and Amazon, which leverage their larger resources and brand recognition.
Investment Considerations
Nebius’s prominent exposure to the AI infrastructure market suggests promising prospects, contingent upon continuous growth in the industry. Nonetheless, the company also contends with risks associated with overexpansion. In 2024, it incurred $808 million in capital expenditures, with plans for further investment in the coming year.
Global Economic Concerns
Recent warnings from the International Monetary Fund and the Bank of England highlight the potential risks in the AI market, citing global uncertainty and changing investor sentiments. These factors could dampen spending on AI technologies, impacting Nebius’s growth trajectory.
Valuation Analysis
Currently, Nebius has a price-to-earnings (P/E) ratio of 114, a steep premium compared to the S&P 500 average of 3.4. This valuation reflects the company’s impressive growth but indicates that much of its future success is already anticipated in the stock price.
For investors seeking substantial returns, it may be prudent to explore other opportunities within the AI sector. While Nebius is by no means a poor investment, potential backers should evaluate all options carefully before deciding.
