Nebius surges 20% in June as AI cloud capacity hits 4 GW

Nebius Group has ridden the AI infrastructure boom to a 20% monthly gain, but the same forces driving its ascent are amplifying its volatility.

Nebius Group (NASDAQ: NBIS) shares jumped 19.5% in June, according to S&P Global Market Intelligence, extending a rally that has more than quadrupled the stock over the past 12 months and pushed its market cap to roughly $55 billion. The gains reversed sharply in the first trading week of July, with the stock crashing nearly the same amount as sector-wide uncertainty resurfaced.

"The demand for AI compute is outstripping supply by a wide margin, and Nebius is one of the few independent players with the capital to scale," said a cloud infrastructure analyst who tracks the sector. "But the market is pricing in perfection, and any whiff of a CapEx slowdown will hit these names disproportionately."

The company's contracted power capacity guidance has surged from at least 1 gigawatt last August to over 4 GW, reflecting the breakneck pace of its data center buildout. In May, Nebius said it had secured 1.2 GW of power and land for an AI factory at a new site in Pennsylvania, and it partnered with fuel cell maker Bloom Energy to install additional capacity. The expansion supports Nebius' cloud computing infrastructure for AI model development and training — a market where demand has overwhelmed supply across the industry.

Revenue has tracked the capacity ramp. Nebius generated just $105 million in sales in the second quarter of 2025, but by the fourth quarter it had reached an annual revenue run rate of $1.25 billion. Management now expects to exceed $3 billion in revenue for 2026, with a run rate by year-end that could more than double again in 2027. That trajectory places Nebius among the fastest-growing infrastructure providers in the AI ecosystem, alongside rival CoreWeave.

The power bottleneck becomes the story

The US heatwave sweeping across the country this July has exposed a critical strain on power grids driven partly by the growing energy demands of AI data centers. For Nebius, access to reliable, low-cost power is both its biggest competitive advantage and its most significant operational risk. The company's partnership with Bloom Energy addresses one piece of the puzzle — fuel cells can provide on-site generation that bypasses grid constraints — but scaling to 4 GW of capacity requires navigating utility interconnection queues, permitting timelines, and local opposition that have delayed projects across the sector.

Nebius' Pennsylvania site alone accounts for 1.2 GW of that target, roughly enough to power 1 million US homes. The company has not disclosed the total capital expenditure required to bring the full 4 GW online, but comparable hyperscale data center builds typically cost $8 million to $12 million per MW, implying a total investment of $32 billion to $48 billion over the buildout cycle.

Valuation and the volatility trade-off

At a $55 billion market cap, Nebius trades at roughly 18 times the midpoint of its 2026 revenue guidance and about 9 times a potential 2027 revenue run rate of $6 billion. Those multiples are not extreme for a company growing at triple-digit rates, but they leave little room for error. CoreWeave, its closest public comparable, faces similar valuation dynamics, and any signal that hyperscalers are tempering their AI infrastructure spending could trigger a sector-wide repricing.

For long-term investors, the volatility cuts both ways. Nebius shares have more than doubled year to date, but the June rally followed by the July reversal shows how quickly sentiment can shift in a market where growth expectations are already priced in. The company's ability to execute on its 4 GW capacity target, secure additional power agreements, and convert that infrastructure into revenue will determine whether the stock can sustain its trajectory — or whether the pullbacks become deeper than the rallies.

This article is for informational purposes only and does not constitute investment advice.