Nebius Group N.V. (Ticker: NBIS) is an AI cloud company that provides the essential computing power and tools for businesses and developers to build and run artificial intelligence models. Headquartered in Amsterdam, the company operates globally, with a significant presence in Europe, the U.S., and other regions.

1. The Business Model (How They Make Money)

Nebius Group's core business revolves around providing "AI infrastructure-as-a-service." Think of them as renting out super-powerful computers, specifically those with advanced graphics processing units (GPUs), which are crucial for the heavy lifting involved in training and running AI models. They offer a complete package, including these high-performance GPU clusters, cloud services, and specialized tools for developers.

Their main way of making money comes from these AI cloud services, which are typically based on how much customers use and are often secured through long-term contracts. For the full year ended December 31, 2025, Nebius AI Cloud generated $480.3 million in revenue, representing about 91% of the company's total revenue.

Beyond their primary AI cloud business, Nebius Group also has other ventures:

• Avride: This segment focuses on developing technology for self-driving vehicles and delivery robots. In 2025, Avride contributed $1.3 million to the company's revenue.
• TripleTen: An online education platform that helps people learn new tech skills for careers in technology. TripleTen generated $54.1 million in revenue in 2025.

In July 2026, Nebius introduced a new "asset-light" business model. Under this approach, instead of always building and owning all their data centers and hardware, they partner with other companies. These partners finance, own, and operate the physical infrastructure, while Nebius provides its specialized software, system design, and sales expertise. This allows Nebius to expand its AI cloud capacity more quickly and with less upfront investment, often through revenue-sharing or licensing agreements.

2. The Metrics That Matter Most

For Nebius Group, given its rapid growth in the AI infrastructure space and its capital-intensive nature, these performance metrics are particularly important:

• Revenue: This metric tells us the total amount of money Nebius brings in from selling its AI cloud services and other offerings. For a company like Nebius, which is expanding quickly in a high-demand market, strong revenue growth shows that more and more customers are choosing their AI infrastructure. In the first quarter of 2026, Nebius reported $399.0 million in revenue, a significant increase of 684% compared to the same period in 2025. For the full year 2025, total revenue reached $529.8 million, up 479% from the previous year. This rapid increase indicates strong demand for their AI computing power.
• Operating Cash Flow: This shows how much cash the company generates from its regular business operations before accounting for big investments or financing activities. For Nebius, which needs to invest heavily in data centers and equipment, a healthy operating cash flow is crucial. It indicates the company's ability to fund its growth internally and manage its working capital effectively. In 2025, Nebius's operating cash flow was $384.8 million, significantly boosted by customer prepayments from major contracts.
• CapEx (Capital Expenditures): This metric represents the money Nebius spends on buying, maintaining, or improving its physical assets, like servers and data center equipment. Since providing AI infrastructure requires massive investments in hardware, CapEx is a direct indicator of how much the company is investing to build out its capacity to meet customer demand. In 2025, Nebius invested $4.07 billion in CapEx, primarily for servers and data center equipment. The new "asset-light" model aims to reduce the direct CapEx burden on Nebius by having partners finance some of the infrastructure.
• Operating Income: This metric measures the profit a company makes from its core business operations after covering its everyday costs, but before accounting for interest and taxes. For Nebius, which is in a high-growth phase and making substantial investments, operating income helps investors see if the main business is becoming profitable, separate from one-time gains or financing costs. In 2025, Nebius reported an operating loss of $611.7 million. While still negative, tracking this metric shows progress towards operational efficiency as the company scales.
• Debt to Equity: This ratio compares a company's total debt to the value of its shareholders' equity. It's a key indicator of how much a company relies on borrowing versus its own funds to finance its operations and growth. For a company like Nebius that requires significant capital for expansion, understanding its debt levels is important for assessing financial risk. As of December 31, 2025, Nebius had a debt-to-equity ratio of 1.71x, reflecting the substantial convertible bonds issued to fund its infrastructure build-out.

3. How to Value This Company

For Nebius Group, the most relevant valuation metric is P/Sales (Price-to-Sales Ratio).

Here's why:

Nebius is a company in a very high-growth industry, rapidly expanding its revenue base. While it's making huge investments to build out its AI infrastructure, it's not yet consistently profitable in terms of operating income or net income from continuing operations. In such cases, traditional valuation metrics like the P/E (Price-to-Earnings) ratio might not be the best fit because earnings can be low or even negative due to heavy reinvestment.

The P/Sales ratio helps you figure out if the stock is cheap or expensive by comparing the company's total stock market value (its "market capitalization") to its total sales (revenue) over the last year. It essentially tells you how much investors are willing to pay for each dollar of the company's sales. For Nebius, with its explosive revenue growth, P/Sales allows investors to value the company based on its ability to generate top-line growth, which is a strong indicator of future potential in a rapidly expanding market like AI cloud services. A lower P/Sales ratio might suggest the stock is undervalued relative to its sales, while a higher ratio could mean investors expect very strong future growth.