By 2031, Nebius Group (NBIS) is poised to become the next household name in the field of artificial intelligence. Although current attention in the AI sector remains highly concentrated on the “Magnificent Seven” such as NVIDIA, Microsoft, and Meta, as well as companies like Broadcom and Palantir, Nebius is quietly making its way into the race with its unique positioning and rapid growth.
Nebius has taken a different development path compared to most of its peers. Its predecessor was part of the Russian internet giant Yandex, which was spun off and became independently operated due to geopolitical changes, listing on NASDAQ in October last year. Even more notably, NVIDIA not only invested in the company but also listed it as a strategic ally, significantly enhancing Nebius’s credibility within the industry.
The company’s core business, Nebius NeoCloud, focuses on AI infrastructure. By building its own data centers, it rents out NVIDIA’s high-performance GPUs in the form of cloud services. This model allows it to keep pace with NVIDIA’s technological advancements, continuously benefiting from the launch of next-generation chips such as Blackwell and Rubin. However, Nebius’s business extends far beyond hardware leasing. It also owns several subsidiaries, including the data annotation platform Toloka, the autonomous driving system Avride, the developer training platform TripleTen, and holds equity in the open-source database system ClickHouse. This diversified portfolio enables it to penetrate various high-growth areas such as AI model training, data analysis, and robotics, providing access to multiple trillion-dollar market opportunities.
From a financial perspective, Nebius’s growth is remarkable. As of December 2024, the infrastructure segment’s annualized operating revenue was $90 million, but by June 30, 2024, the annual recurring revenue had surged to $430 million. Management subsequently raised the full-year revenue forecast from the initial $7.5–10 billion to $9–11 billion. What truly changed the landscape was an agreement with Microsoft on September 8 this year: Nebius will provide dedicated GPU capacity for Microsoft’s New Jersey data center, with a total contract value of $17.4 billion, valid until 2031.
Previously, Nebius’s market capitalization was approximately $15.4 billion, with a forward price-to-sales ratio of about 14x—only half the peak level of its peer CoreWeave—indicating that its valuation has not yet been fully inflated and remains relatively reasonable. Despite increasingly fierce industry competition, Nebius demonstrates strong competitiveness through its partnerships with tech giants, comprehensive technology ecosystem, and rapidly growing performance.
For investors, Nebius represents an opportunity worth watching and holding for the long term, likely emerging as a significant player in the AI field by 2031.
