Nebius Gets Approval For First Gigawatt-Scale AI Factory

Nebius Group NV (NASDAQ:NBIS) is advancing its U.S. expansion after securing local approval for a major AI infrastructure project while continuing to report rapid growth in its core AI cloud business.

City Approves Large AI Factory Campus

The Independence City Council approved Nebius’ plan to build a large-scale AI factory campus, marking a key milestone for the AI cloud company.

Once completed, this AI facility will be Nebius’s largest in the U.S., boasting a capacity of up to 1.2 gigawatts.

The campus will span approximately 400 acres and is projected to generate about 1,200 construction jobs, with 130 permanent high-tech roles anticipated post-completion.

The AI factory will feature a closed-loop cooling system to minimize water usage and incorporate noise-reduction technology.

It will connect to Independence Power & Light, ensuring no increase in residential power rates.

Over 20 years, Nebius is expected to contribute more than $650 million to the city and local school districts through Payments in Lieu of Taxes (PILOT).

AI Cloud Business Drives Rapid Growth

In February, Nebius reported a fourth-quarter adjusted loss of 68 cents per share, beating expectations for a $1.14 loss, while revenue came in at $227.7 million, below the $246.04 million consensus estimate.

The company grew fourth-quarter revenue 547% year over year and 56% sequentially, with core AI cloud revenue surging more than 800% and accounting for about 94% of total group revenue.

Nebius said demand in its AI cloud business exceeded capacity, and the platform operated at peak utilization during the quarter.

Annualized run-rate revenue reached $1.25 billion by the end of December, topping prior guidance of $900 million to $1.1 billion and more than doubling from the third quarter.

Capacity Expansion And Long-Term Outlook

Nebius reported its first-quarter group-level adjusted EBITDA of $15 million.

Its core AI cloud business generated $51.8 million in adjusted EBITDA with a 24% margin.

Nebius finished the year with about 170 megawatts of active power, above its 100-megawatt target, and secured more than 2 gigawatts of contracted power.

Management expects contracted power to exceed 3 gigawatts by the end of 2026 and reiterated its goal of reaching $7 billion to $9 billion in annualized run-rate revenue by year-end 2026.

Recently, Compass Point launched coverage on the stock with a Buy rating and a $150 price forecast.

NBIS Price Action: Nebius Group shares were up 2.65% at $89.10 during premarket trading on Wednesday, according to Benzinga Pro data.

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