Layer 0 · NBIS — Nebius Group
Thesis
The best print in the entire scaling-cloud cohort — $399M revenue (+684% YoY), 45% EBITDA margin, $27B Meta contract + $2B NVDA equity stake. Tier B not Tier A because the stock is +50% in a single month and capex is being raised to $20-25B, which materially raises balance-sheet risk even on a Meta-anchored book.
What it does + financial print
Nebius is the European answer to CoreWeave — formerly Yandex's cloud unit, now a standalone NASDAQ-listed AI cloud with anchor sites in Finland, Israel, France, and now a 1.2 GW Pennsylvania mega-site announced May 12. NVDA's reference architecture, Meta's $27B 5-year contract, and $2B in fresh NVDA equity — the model is GPU-as-a-service with secular take-or-pay structure.
Q1 2026 printed $399M revenue (+684% YoY) versus ~$370M consensus. Net income swung to $621M positive (large one-time on equity remeasurement). ARR was $1.92B at end-March, exit-CY26 target raised to $7-9B (3-4x current). Capex raised to $20-25B for FY26. The print is the cleanest scaling-cloud number we've seen.
Bull case
ARR exits CY26 at >$8B (high end of guide), Meta contract triggers additional volume, and the 1.2 GW Pennsylvania site comes online on schedule in 2027. EBITDA margins hold at 45%+ as scale grows. At that trajectory the stock is a 2026 Tier A holding by the August print.
Gap / bear case
+50% in a month is a parabolic move on top of an already-extended chart. $20-25B of capex on a balance sheet still developing access to investment-grade debt is a real risk — any speed-bump in ARR ramp combined with rising rates and the equity has to fund the gap dilutively. Meta concentration: one customer is ~70%+ of contracted ARR.
Trigger to upgrade / downgrade
Upgrade to Tier A on (a) a pullback to $170-185 that holds 50-day, AND (b) Q2 print confirming ARR run-rate ≥$3B with no capex surprise to the upside. Downgrade only on Meta contract renegotiation.
The trade
- Entry zone: $170-185 on the first real pullback; do not chase $230+
- Stop: $158 close (below recent breakout shelf)
- Position size: 1.5% NLV starter; 3% on confirmation
- Catalyst date: Q2 print August 7 2026
- Conviction: 7/10