Nebius Group (NBIS) Is Down 7.6% After Landmark Microsoft Deal and Token Factory Launch – Has the Bull Case Changed?

Earlier this month, Nebius Group announced the launch of Nebius Token Factory, a full-stack AI production inference platform, alongside news of a landmark US$19.4 billion, five-year GPU infrastructure contract with Microsoft and raised over US$4.2 billion for data center expansion. These developments position Nebius Group as a crucial infrastructure partner in the AI cloud sector, enabling enterprises to efficiently scale and control open-source and customized models for production-level applications. We'll now explore how the Microsoft contract and Token Factory rollout reshape Nebius Group's investment narrative and long-term outlook.

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Nebius Group Investment Narrative Recap

To be a shareholder in Nebius Group, you need to believe that surging demand for AI computing and cloud infrastructure will sustain its rapid revenue growth and support higher long-term profitability, despite intensified competition and expansion costs. The recent US$19.4 billion Microsoft contract further strengthens Nebius’s near-term visibility as a critical catalyst, while the most immediate risk remains regulatory hurdles and compliance costs in core markets, potentially limiting expansion ambitions. This news reinforces the path to scale but does not eliminate the ongoing compliance risk around global growth.

Among recent announcements, the unveiling of Nebius Token Factory stands out, as it directly addresses scale, governance, and performance hurdles for enterprises adopting AI. By broadening its toolkit for production-grade AI solutions, Nebius is better positioned to meet hyperscaler and enterprise demands, supporting the promise of recurring revenue from large contracts, though continued execution and capacity rollout will shape how much it translates into real financial gains.

Yet, despite these milestones, investors should be aware that mounting compliance and localization costs could...

Read the full narrative on Nebius Group (it's free!)

Nebius Group's narrative projects $3.2 billion revenue and $428.7 million earnings by 2028. This requires 133.9% yearly revenue growth and a $238.5 million earnings increase from $190.2 million today.

Uncover how Nebius Group's forecasts yield a $156.40 fair value, a 41% upside to its current price.

Exploring Other PerspectivesNBIS Community Fair Values as at Nov 2025

Thirty-six fair value estimates from the Simply Wall St Community span from US$9.17 to US$176.90, reflecting significant divergence in individual growth assumptions. While you consider these wide-ranging perspectives, remember that regulatory compliance and localization remain key barriers shaping Nebius Group’s global expansion and future financial outcomes.

Story Continues

Explore 36 other fair value estimates on Nebius Group - why the stock might be worth less than half the current price!

Build Your Own Nebius Group Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

A great starting point for your Nebius Group research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision. Our free Nebius Group research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Nebius Group's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include NBIS.

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