Nebius Shares Rally Before Earnings as CoreWeave Results Lift Sector

what happened

Nebius Group shares climbed roughly 16% to $155.85 on Wednesday, recovering some ground after a prolonged slide, according to Barron's. The rebound was driven by a solid quarterly report from larger rival CoreWeave, whose revenue topped expectations even though interest costs wiped out its operating profit. Before the bounce, Nebius had fallen 58% from its peak close on June 18, and about 23% of its free float was held short.

FactSet data show analysts expect Nebius to post a third-quarter loss of 72 cents a share, versus 41 cents a year earlier, while revenue is forecast to surge more than 500% to $907 million. The company recently took a $3.5 billion secured debt facility from Citi and has roughly $10 billion of convertible bonds outstanding. Projected interest expense for the quarter is $146 million.

Investors will likely press management on the cost of building out its data centers and on growing local resistance to such facilities. The company operates and plans sites in several U.S. states, as well as in Western Europe and Scandinavia.

why it matters

Neocloud providers such as Nebius and CoreWeave fund their infrastructure with borrowed money, so their shares are sensitive to the cost of capital and to signs that spending on AI infrastructure will keep growing. CoreWeave's stated move toward contract-backed delayed-draw loans and away from high-interest unsecured bonds may point to cheaper financing across the sector.

market impact

AI cloud stocks: CoreWeave's strong report supports the sector, while Nebius faces scrutiny at its earnings

• ▲Nebius shares pressure up — rebound after a steep decline, helped by CoreWeave's revenue beat

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