TLDR
- Nebius Group (NBIS) secured an AI cloud computing deal with Microsoft worth $17.4-$19.4 billion through 2031
- The deal will provide AI computing power via a New Jersey data center using Nvidia chips
- Nebius stock jumped 49-60% on the announcement, hitting record highs
- Microsoft continues expanding partnerships with third-party providers like Nebius and CoreWeave to meet AI demand
- This marks Nebius’s first long-term contract with a major tech company, with more deals expected
Nebius Group stock rocketed to record highs after landing a massive AI infrastructure contract with Microsoft. The Amsterdam-based company will provide computing power worth up to $19.4 billion over the next six years.
The deal runs through 2031 and represents a major win for Nebius in the competitive AI infrastructure market. Microsoft will receive computing resources from a New Jersey data center operated by Nebius.
Shares jumped between 49% and 60% depending on the trading session measured. The stock hit all-time highs after pulling back over recent weeks.
Microsoft stock moved modestly higher by 21 cents on the news. The tech giant continues expanding its AI infrastructure partnerships to meet growing demand.
Nebius uses Nvidia chips to power its data centers. Nvidia serves as both a supplier and investor in the company. Nvidia stock gained 1.5% but remains below its 50-day moving average.
The partnership addresses Microsoft’s need for additional AI computing capacity. OpenAI, one of Microsoft’s largest Azure customers, has been searching for more infrastructure as ChatGPT usage grows.
Microsoft already has agreements with other AI infrastructure providers. The company previously signed deals with CoreWeave for similar computing services.
CoreWeave stock jumped 7.1% on the Nebius announcement. The company remains 46% below its late June peak despite the gains.
Growing AI Infrastructure Demand
Both Nebius and CoreWeave rely on Nvidia chips for their operations. Nvidia has invested in both companies as the chip maker expands its ecosystem.
CoreWeave launched a new ventures arm Tuesday to invest in AI companies. The move shows how infrastructure providers are diversifying beyond basic computing services.
Nebius called this its first long-term contract with a major technology company. The company expects more deals to follow based on current market dynamics.
The agreement allows Nebius to accelerate growth plans beyond original projections. Company executives said they are exploring financing options to support faster expansion.
Market Response and Company Growth
Nebius had already doubled in value this year before the Microsoft announcement. The company’s market cap exceeded $15 billion at Monday’s close.
The stock surge reflects investor appetite for AI infrastructure plays. Companies providing computing power for AI training have attracted strong investor interest.
Nebius expanded its US presence last year with offices in San Francisco, Dallas and New York. The company aims to support American AI businesses from these locations.
The Microsoft deal validates Nebius’s strategy of targeting large enterprise customers. Previous growth came primarily from smaller AI companies and startups.
Nebius changed its name from Yandex NV last year after Russian investors acquired Yandex’s search engine assets. The restructuring allowed the company to focus on AI infrastructure.
The New Jersey data center will begin delivering services under the Microsoft contract soon. Specific timing details were not disclosed in company statements.
Microsoft continues seeking third-party providers as internal Azure capacity faces constraints. The partnership model allows faster scaling than building proprietary infrastructure.
Nebius stock closed Tuesday at record levels following the 49% surge during regular trading hours.
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