Key Takeaways
- Nebius is a cloud infrastructure company that provides graphics processing units (GPUs) in a full-stack platform for AI workloads
- The company expects jaw-dropping growth in 2026, with revenue projected to reach between $7 billion and $9 billion
- Nebius’s stock may look expensive, but its forward sales metric suggests it’s undervalued
- The company’s growth trajectory is expected to be similar to CoreWeave, a competitor in the same space
- Nebius and CoreWeave are currently in the market-capturing phase, focusing on expansion rather than profitability
Introduction to Nebius and CoreWeave
Nebius and CoreWeave are two companies that are making waves in the cloud infrastructure space, particularly when it comes to artificial intelligence (AI) workloads. As the article notes, "Not every AI hyperscaler has the capacity they need to process all the workloads they want to run, and having some infrastructure that is owned by a different entity is also a smart move because it eliminates a single point of failure." This is where companies like Nebius and CoreWeave come in, providing the necessary infrastructure for AI hyperscalers to run their workloads. Nebius, in particular, operates in a similar field as CoreWeave and offers GPUs in a full-stack platform to give its clients everything they need to run AI workloads on its servers.
Nebius’s Expansion Plans
Nebius has huge expansion plans in 2026, with the company expecting to grow its revenue from $551 million to between $7 billion and $9 billion. This represents a significant increase, with the company’s annual run rate expected to more than double in the next year. As the article notes, "In Q3, Nebius grew its revenue by 355% year over year. A stat like that is enough to get any growth investor excited, but it gets better." This growth is driven by the increasing demand for AI computing power, with Nebius having to increase its contract power from 1 gigawatt to 2.5 gigawatts to meet this demand.
Valuation and Growth Potential
Despite its high valuation, with a price-to-sales ratio of 64, Nebius’s stock may not be as expensive as it seems. The article notes that "the correct one to use is the forward sales metric, as it factors in the monster growth Nebius expects." Using this metric, Nebius’s valuation is more reasonable, and the company’s growth potential is significant. As the article states, "If Nebius delivers that kind of growth, the upside for its stock could be massive." With the company expected to follow a similar growth trajectory as CoreWeave, Nebius’s stock could be a good bet for investors looking for growth-at-all-costs companies.
Comparison to CoreWeave
CoreWeave is a competitor to Nebius in the cloud infrastructure space, and the two companies are often compared. While CoreWeave is larger than Nebius, with a higher market capitalization, Nebius’s growth potential is significant. As the article notes, "I’d expect Nebius to follow a similar growth trajectory as CoreWeave as long as AI spending stays up, which could be huge news for the stock." The biggest question surrounding both companies is when they will turn a profit, with both currently in the market-capturing phase of their development.
Profitability and Operating Margins
The article notes that "a fully mature cloud computing company like Amazon Web Services posts operating margins of 35%." If Nebius and CoreWeave can achieve this level of profitability, they would be considered highly successful businesses. However, this is not expected to happen for a few years, as both companies are currently focused on expansion rather than profitability. As the article states, "Today’s Change(0.53%) $0.52Current Price$97.82Key Data PointsMarket Cap$25BDay’s Range$97.20 – $104.9652wk Range$18.31 – $141.10Volume389KAvg Vol17MGross Margin-1312.43%." Despite this, the potential for growth is significant, and the market’s appetite for growth-at-all-costs companies like Nebius and CoreWeave will drive their stock prices.
Conclusion
In conclusion, Nebius is a company to watch in 2026, with significant growth potential and a strong position in the cloud infrastructure space. As the article notes, "I still wouldn’t be surprised to see Nebius double this year." With its expansion plans and growth trajectory, Nebius is a good bet for investors looking for growth-at-all-costs companies. However, the company’s profitability and operating margins will be key to its long-term success, and investors should keep a close eye on these metrics as the company continues to grow.
https://www.fool.com/investing/2026/01/11/this-coreweave-rival-could-double-in-2026/