TLDR
- Nebius (NBIS) stock climbed about 2% in premarket trading Wednesday.
- William Blair started coverage with an Outperform rating, calling Nebius “not just another neocloud.”
- The call follows a BNP Paribas upgrade last week that raised its price target to $399.
- BNP Paribas projects Nebius could approach $22 billion in annual recurring revenue by end-2027.
- Nebius will raise prices on select Nvidia GPU models starting October 1.
Nebius Group NV Class A stock rose close to 2% in premarket trading Wednesday. The move came after William Blair initiated coverage of the AI cloud provider with an Outperform rating.
Analyst Jason Ader wrote that Nebius stands apart from other AI infrastructure firms. He pointed to its infrastructure scale, software capabilities, customer relationships, and access to low-cost capital.
Ader called Nebius “not just another neocloud.” He also said the stock’s current valuation does not fully reflect its long-term earnings power.
The William Blair note follows a bullish call from BNP Paribas on September 24. That firm upgraded Nebius to Outperform from Neutral.
BNP Paribas also raised its price target to $399 from $260. The bank said Nebius’s outlook has improved a lot since it started covering the stock in June.
Revenue Growth Fuels Analyst Optimism
BNP Paribas projects Nebius could approach $22 billion in annual recurring revenue by the end of 2027. Analysts think the company’s 2027 guidance could reset market estimates higher once it arrives.
Nebius reported second-quarter revenue of $582.3 million. That figure marked a 454% increase from a year earlier.
Adjusted EBITDA swung from a loss of $21 million to earnings of $236.2 million. Adjusted net loss narrowed 64% year over year to $33.2 million.
Nebius called the second quarter its best commercial period yet. Four major AI cloud deals each carried an average total contract value above $1 billion.
The company’s five-year deal with Meta Platforms carries a potential value of up to $27 billion. Nebius said in July it had more than $40 billion in additional contracted revenue from investment-grade customers, including Microsoft and Meta.
Capital and Pricing Moves Add to the Story
Nebius closed a $5.75 billion convertible-note offering in August to fund its expansion. The company also announced a $10 billion buildout of an AI factory in Finland.
Starting October 1, Nebius will raise prices on several Nvidia GPU models within its cloud platform. Some analysts view this as a sign that demand for its compute capacity keeps outpacing supply.
Earlier this month, Palantir named Nebius its preferred sovereign AI infrastructure partner. The deal will give eligible Palantir customers access to Nebius compute and inference capabilities.
Not every signal points bullish, though. Investor Michael Burry has converted short positions in Nebius into put options expiring before summer 2027, framing it as part of a broader AI bubble hedge.
That bearish bet has not slowed the stock’s climb so far. Nebius remains well above its 52-week low of $73.52 but still sits below its 52-week high of $299.86.
According to WSJ data, the consensus rating on Nebius stock is overweight. Analysts have handed out 14 buy ratings, one overweight rating, seven hold ratings, one underweight rating, and one sell rating.
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