Nebius: I Can’t Stop Buying This Stock | 40% Of My Portfolio Now
Introduction: A Bullish Reassessment
It’s time to revisit my thesis on Nebius Group N.V. (NASDAQ: NBIS). After being completely unplugged during my vacation, I returned to the markets just in time to witness two major developments. First, Nebius posted stellar Q1 results, exceeding expectations. Second, the stock dipped sharply during the premarket session on June 2. That dip? I bought it—again. As of this writing, Nebius represents 39% of my net liquidation value, with unrealized returns north of 22%.
While I remain strongly bullish, I also acknowledge the inherent risks tied to operational and geopolitical uncertainties. So, here’s a detailed look at why I can’t stop buying Nebius, why institutional investors are increasingly interested, and why the market reaction to the $1 billion private placement was a misread.
Q1 Earnings: Smashing Expectations
ARR Beats Guidance
Back in Q4, CEO Arkady Volozh had forecast an Annual Recurring Revenue (ARR) of at least $220 million by March. Nebius crushed that number, delivering $310 million in ARR for Q1. Revenue nearly quadrupled year-over-year, and CapEx was revised from $1.5 billion to $2 billion, reflecting higher demand and expansion plans beyond the US and Europe.
Global Expansion Underway
The company is now actively expanding into new markets, including a major $140 million contract in Israel to build and operate a supercomputer with 4,000 Nvidia Blackwell GPUs. Remarkably, Nebius won the contract over tech giants like Google and Amazon, who reportedly withdrew due to internal opposition over the political nature of the deal.
According to management, revenue from the Israel deal will begin contributing significantly in 2026, but investment in the infrastructure begins this year.
Strong Balance Sheet and Capital Flexibility
Nebius ended Q1 with $1.48 billion in cash and short-term investments. With the addition of the recent $1 billion private placement, the company is well-positioned to fund its aggressive CapEx plan without diluting shareholders.
In fact, Nebius has multiple non-dilutive options to raise capital:
- 28% stake in ClickHouse
- Majority ownership of Toloka, which recently received backing from Bezos Expeditions
Forward Guidance: Confident and Ambitious
2025 Forecast
The company reaffirmed its 2025 ARR guidance of $750 million to $1 billion, with revenue expectations between $500 million and $700 million. Adjusted EBITDA is projected to turn positive in the second half of 2025, although full-year EBITDA will likely remain negative.
Mid- and Long-Term Outlook
In the medium term, revenue is expected to reach mid-single digit billions, with EBIT margins of 20–30%. Long-term EBIT margins are forecasted to exceed 30%. This “mid-term” is loosely defined as 2-3 years out, around 2027.
Meanwhile, the company aims to grow from 100MW of infrastructure capacity in 2024 to 1GW, a tenfold increase.
Why I Bought More: Private Placement Explained
Convertible Notes at a Premium
The recent $1 billion private placement spooked some investors, causing a 6% dip in premarket trading on June 2. However, most missed the details: these convertible notes are trading at a 40% premium.
Typically, convertible notes are issued at a discount to attract buyers. In Nebius’ case, the conversion premium is a staggering 68% (2029 notes) and 75% (2031 notes). This means investors believe the stock price will be significantly higher than current levels at maturity. It’s an extremely bullish signal.
Even better? This premium ensures minimal dilution if the notes are converted. It’s essentially a vote of confidence from sophisticated investors.
Institutional Support: Growing Despite Sell-Off
According to Whale Wisdom’s latest 13F data:
- 325 institutional funds now hold Nebius, up 25% from Q4.
- 90 funds increased their positions.
- Call options nearly doubled, suggesting bullish bets.
- While 13F shares fell by 20%, this likely reflects Q1 volatility rather than long-term sentiment.
The rise in puts doesn’t worry me—it likely reflects hedging, not bearish conviction.
Risks: Operational and Geopolitical Headwinds
GPU Supply Chain Uncertainty
The most pressing operational risk lies in GPU availability. Nebius depends heavily on Nvidia GPUs, and geopolitical events—like a China-Taiwan conflict—could disrupt supply. Any such disruption would jeopardize Nebius’ ARR, EBITDA, and revenue projections.
Geopolitical Volatility
A Chinese invasion of Taiwan is a low-probability, high-impact event. But in a world of rising US-China tensions, even remote risks must be considered. This is why I emphasize diversification—even while being extremely bullish.
Conclusion: Strong Conviction, Measured Caution
I’ve increased my position in Nebius following the unjustified selloff tied to the private placement. The market misread a bullish development as bearish, creating a rare buying opportunity.
Every metric in the company’s guidance was reaffirmed—except CapEx, which was increased, a clear indicator of accelerating demand. Between stellar earnings, a clean growth narrative, institutional confidence, and strategic capital moves, Nebius remains one of the most compelling high-risk, high-reward plays in my portfolio.
If the stock pulls back this week (as expected due to overbought RSI), I may even buy more. But make no mistake: this is a speculative bet, and I urge you to diversify your investments. My strategy isn’t for everyone—but for now, I’m all in on Nebius.
Disclosure: Long NBIS. This is not financial advice. Conduct your own due diligence before investing.