Nebius Group (NASDAQ: NBIS) delivered an eye-catching earnings report this week, showcasing a staggering 684% year-over-year revenue growth, which, while impressive, stemmed from a low base. Despite increasing net losses compared to the previous year, the stock surged 24.2%, driven by a significant upward revision in its contracted data center power capacity guidance for 2026, now set at a minimum of 4 gigawatts. This enhancement positions Nebius to better meet the soaring demand for AI compute infrastructure.
The company’s first-quarter AI cloud revenue skyrocketed by 841% year-over-year, underscoring robust momentum in its core business. However, the stock’s meteoric rise—up 163% year-to-date—has raised caution among analysts, with Morgan Stanley increasing its price target to $144, still below the current trading price of nearly $220.
Investors may want to consider taking profits, as momentum stocks like Nebius can experience rapid declines as quickly as they rise.
Source: fool.com