Nebius Stock Falls 18% Despite Q3 Beat as 2026 Outlook…

Nebius stock fell 17.72% to $127.58 at 2:57 p.m. ET on Thursday, November 12, despite reporting third-quarter revenue well above Wall Street expectations. The AI cloud provider generated $980.8 million in revenue, up 571% year over year, but investors focused on a weaker 2026 outlook, delayed data center capacity and a substantially larger capital spending plan for 2027.

The decline followed Wednesday’s 15.44% rally, when Nebius Group (NASDAQ: NBIS) closed at $154.69 after stronger results from rival CoreWeave improved sentiment toward AI infrastructure companies. Thursday’s selling more than erased that advance, even as management forecast revenue of $12 billion to $13 billion in 2027.

The immediate concern is timing. Nebius now expects 2026 revenue at the low end of its $3 billion to $3.4 billion range after delays at third-party facilities pushed some planned capacity into 2027. Its December annualized revenue target has also moved to February, while the company expects to spend between $40 billion and $45 billion next year.

Nebius Beats Q3 Revenue Forecasts, but Not Without Qualifications

According to Nebius’ third-quarter financial results, revenue increased from $146.1 million a year earlier to $980.8 million, representing 571% growth. Adjusted EBITDA reached $465.8 million, compared with a $5.2 million loss in the corresponding quarter last year.

The net loss from continuing operations narrowed to $37.5 million from $119.6 million, while adjusted net income reached $90.9 million. These figures demonstrate a substantial improvement in operating performance, although adjusted EBITDA excludes expenses such as depreciation that are particularly relevant to capital-intensive data center businesses.

Revenue also exceeded the estimates available before the announcement. Koyfin’s consensus, cited by Stocktwits, was approximately $907 million. Zacks expected $916.8 million, according to EBC Financial Group, while a Benzinga estimate cited by Tickeron was approximately $937 million.

The reported revenue exceeded those three estimates by approximately $44 million to $74 million, or 4.7% to 8.1%. The beat therefore holds regardless of which published consensus figure is used.

However, management disclosed an important qualification in its shareholder letter: approximately $325 million of third-quarter revenue was non-recurring, generated through the initial rollout of its asset-light partnership model.

That amount represents about one-third of total quarterly revenue. Excluding it leaves approximately $655.8 million, although that calculation is not a company-reported recurring revenue measure and should not be compared directly with the unadjusted analyst consensus.

Nebius expects its asset-light business to generate revenue more regularly as additional partnerships develop. For investors, the distinction matters because the headline growth rate includes a substantial contribution that may not repeat at the same level in the next quarter.

2026 Guidance Slips as Microsoft-Related Capacity Faces Delays

In its SEC-filed shareholder letter, Nebius said it now expects full-year revenue at the low end of its existing $3 billion to $3.4 billion forecast. Management maintained its adjusted EBITDA margin outlook of approximately 40%.

The lower revenue expectation reflects delays at third-party colocation facilities. Capacity that Nebius previously expected to activate before the end of 2026 is now scheduled to become operational during the first half of 2027.

One significant source of the delay is New Jersey, where the company is transitioning its electricity supply to Bloom Energy fuel cells. Nebius expects to deliver more than half of the capacity contracted with Microsoft by year-end, while the remaining tranches are now scheduled for the second quarter of 2027.

Management said Microsoft was involved in planning the revised timetable and that the underlying customer contracts remain in place. This points to a delay in supplying contracted capacity rather than an announced cancellation of demand.

The development adds context to earlier concerns about Microsoft’s oversight of neocloud infrastructure projects. FinanceFeeds previously reported on Nebius stock’s decline after Microsoft tightened scrutiny of third-party data center deployments, when the market had no confirmed change to the company’s Microsoft agreement.

Thursday’s disclosure provides a more specific operational issue: the delivery schedule has changed, and revenue recognition is moving accordingly.

With nine-month revenue totaling $1.962 billion, reaching the low end of the full-year forecast requires approximately $1.038 billion in fourth-quarter revenue. That would represent growth of only about 5.8% from the third quarter’s reported figure.

The company also pushed back its annualized run-rate revenue target. ARR reached $6.4 billion at the end of September, compared with $3 billion at the end of June. Management had previously targeted $7 billion to $9 billion by December but now expects ARR to exceed $7 billion in February 2027.

The revised expectation does not establish that the entire former $7 billion to $9 billion range will be achieved in February. It moves the timing of the lower threshold and leaves the precise trajectory beyond that point less certain.

2027 Revenue Outlook Reaches $13 Billion as Capex Climbs

Despite the softer near-term forecast, Nebius issued an initial 2027 revenue outlook of $12 billion to $13 billion, approximately four times the low end of its expected 2026 revenue. Management also expects to reach pre-tax breakeven in the fourth quarter of 2027, rather than reporting a pre-tax profit for the full year.

The investment required to deliver that expansion is considerable. Nebius raised its 2026 capital expenditure expectation to approximately $27 billion, compared with its previous range of $20 billion to $25 billion. For 2027, it anticipates spending $40 billion to $45 billion.

During the third quarter alone, purchases of property, equipment and intangible assets reached $7.3 billion, up 664% year over year. That compares with $980.8 million in quarterly revenue, illustrating the scale of infrastructure investment occurring ahead of future customer billings.

Management argues that the funding model is becoming more favourable. Since the beginning of the third quarter, customers have committed more than $12 billion in contract value. Nebius also reported that prepayments on agreements signed during Q3 covered more than 100% of the associated capital expenditure, compared with 50% to 60% in the second quarter.

The company expects customer prepayments and financing backed by contracts with investment-grade customers to cover approximately 75% to 85% of its planned 2027 capital expenditures.

That estimate suggests a substantial proportion of the spending could be financed against contracted customer demand. However, it is a prospective financing assumption rather than evidence that every required dollar has already been secured. The remaining funding requirements and the timing of cash receipts will still matter to shareholders.

Nebius also reported that average payback periods for comparable one- to three-year deals improved to one year and seven months from one year and ten months in Q2. Management attributed the improvement largely to higher contracted prices.

Why NBIS Stock Is Trading on Delivery Rather Than Demand

Thursday’s reaction reflects the difference between securing demand and converting it into revenue on schedule. Nebius has reported strong customer commitments, improving pricing and faster expected payback periods, but those achievements do not eliminate the operational risks involved in bringing large data centers online.

Power availability, construction schedules and equipment deployment determine when capacity begins generating revenue. A delay can push revenue into a later reporting period while spending continues, making execution especially important when a company plans tens of billions of dollars in annual capital expenditures.

The contrast with CoreWeave is notable. FinanceFeeds’ coverage of CoreWeave’s Q3 results and raised $13.3 billion revenue outlook highlighted another AI cloud company confronting substantial infrastructure costs, but one that increased its near-term sales guidance.

Before the announcement, FinanceFeeds’ November 8 Nebius earnings preview identified the annualized revenue target, full-year guidance and Microsoft relationship as the critical tests for the quarter. Thursday’s report delivered the expected revenue beat but also confirmed delays affecting two of those measures.

For shareholders, the next evidence will come from actual capacity deliveries rather than additional contract announcements. The remaining Microsoft-related New Jersey capacity is scheduled for the second quarter of 2027, while the revised ARR milestone is expected in February.

Investors will also need to assess whether the $12 billion to $13 billion revenue outlook can be achieved alongside the planned $40 billion to $45 billion investment programme, and whether Nebius can maintain the prepayment terms that underpin its financing assumptions.

The third-quarter results demonstrate substantial demand and improving adjusted profitability, but the accompanying guidance shows how difficult it remains to convert contracted AI infrastructure into revenue on schedule. Thursday’s share-price decline suggests investors are assigning greater weight to the immediate delivery and financing risks than to management’s much larger 2027 revenue target.