Nebius Group today
As of 01/07/2025 16:00 Eastern
- 52 week range
- $14.09
▼
$38.69
Several small and mid-cap companies caught the attention of investors last year thanks to NVIDIA’s initiative. NASDAQ: NVDA investments in these firms are disclosed. One of the latest standouts is the Nebius Group. NASDAQ:NBISa technology company that is now being compared to other NVIDIA successes such as SoundHound AI. NASDAQ:SOUNwhich has grown by more than 800% over the past year.
Despite the connection, Nebius has struggled, with its shares down nearly 20% from their 52-week high in December. But does NVIDIA’s participation mean an acquisition opportunity? Let’s dive deeper.
What is Nebius Group?
Nebius Group NV is a Dutch technology company specializing in artificial intelligence solutions for businesses and consumers. Its flagship offerings include Nebius AI, a cloud platform designed to deploy artificial intelligence and machine learning; Toloka AI, which specializes in generative AI applications such as model training and data generation; Avride, a provider of autonomous vehicles for logistics and taxi applications; and TripleTen, an EdTech platform that equips students with STEM and technical skills.
Formerly known as Yandex NV, the company has undergone a transformation following sanctions imposed on Russia following its invasion of Ukraine. Yandex sold its non-Russian assets, leading to Nebius’ independence and subsequent Nasdaq listing in October 2024.
Following its debut, Nebius raised $700 million through a private placement with participation from NVIDIA and Accel Ventures.
Why is NVIDIA interested?
NVIDIA’s investment aligns with Nebius’ strong growth trajectory and focus on artificial intelligence infrastructure. In the third quarter of 2024, Nebius reported revenue of $43.3 million, up nearly 200% from the prior quarter. The AI infrastructure segment experienced exceptional growth, growing nearly 300% quarter-on-quarter and nearly 650% year-over-year, demonstrating the company’s rapid progress in its core AI offerings.
The AI cloud business is on track to reach $120 million in annual revenue, with forecasts estimating revenues of $750 million to $1 billion by 2025.
Nebius’ strategic initiatives include expanding its data center footprint. The company recently launched a GPU-equipped facility in Kansas City and plans to open another cluster in the US by 2025, expanding the capabilities of its artificial intelligence infrastructure. Through partnerships such as its collaboration with Uber Technologies on autonomous vehicles, Nebius leverages its diverse portfolio to drive innovation.
NVIDIA Factor and Citron Bullish Outlook
NVIDIA’s support sparked optimism, which was further boosted by Citron Research’s endorsement of Nebius as a potential “Wall Street AI darling.” Citron sees parallels between Nebius and competitors such as CoreWeave, forecasting shares could reach $60 per share, suggesting significant upside from current levels.
Nebius plans to invest $1 billion in AI infrastructure by 2025, focusing on leasing capacity for enterprises scaling their AI operations. These capital commitments reflect the company’s desire to gain a foothold in the fast-growing artificial intelligence sector.
Is it worth investing in Nebius Group?
While NVIDIA’s support and Citron’s bullish outlook are compelling, investing in Nebius comes with risks. The company faces stiff competition from established players. However, its financial strength, backed by nearly $2.3 billion in cash and rapid revenue growth, positions it as a high-potential opportunity for risk-tolerant investors.
Real potential also lies in Nebius’ ability to leverage its partnership with NVIDIA to secure relationships with other industry leaders such as Advanced Micro Devices. NASDAQ: AMD and the “Magnificent Seven” of tech giants and cloud hyperscalers such as Microsoft. NASDAQ: MSFT and Amazon NASDAQ: AMZN. If successful, Nebius could deliver significant long-term value and tremendous growth, making it a preeminent player in the artificial intelligence and technology market.
Nebius Group offers a unique combination of opportunity and risk for investors seeking exposure to emerging artificial intelligence infrastructure. NVIDIA’s involvement certainly adds an extra layer of intrigue.
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