- Nebius will provide AI infrastructure to Microsoft between now and 2031
- New Jersey data center will be the first project under the partnership
- The deal is worth $17.4 billion – could reach $19.4 billion
Former Yandex spinoff Nebius, now headquartered in Amsterdam, has signed a multi-year agreement with Microsoft to deliver AI infrastructure to the tech giant.
The contract, valued at $17.4 billion until 2031, will begin later this year with the construction of a new data center in Vineland, New Jersey.
The announcement was complemented by a 6-K filing, revealing that the deal could reach $19.4 billion if Microsoft decides to acquire additional services and/or capacity.
Microsoft strikes up a multibillion-dollar deal with Nebius
Nebius founder and CEO Arkady Volozh said that the Microsoft deal marks just the first of a number of “significant long-term committed contracts with leading AI labs and big tech companies.”
Volozh also noted that Nebius expects the deal to help “accelerate the growth of [its] AI cloud business even further in 2026 and beyond,” remarking that the company “is [already] performing exceptionally well.”
Backing this was the 50% rise in shares two days after the announcement, following a 60% extended trading rise on the announcement day. Nebius shares are currently valued at $95.72, up from $64.19 prior to the announcement.
Nebius posted a 625% year-over-year and 106% quarter-on-quarter increase in revenue to $105.1 million in Q2, attributing the growth to high demand for AI infrastructure like compute, software and services.
This is up from $55.3 million in Q1 revenue.
Its Microsoft deal will be partly funded by cash flow from the deal, and partly by short-term loans that have seen “enhanced” terms thanks to Microsoft’s solid backing.
Microsoft has not publicly commented on the deal.
Besides Microsoft, Nebius has already received investments from other tech leaders, including Nvidia and Accel.
Looking ahead, Nvidia CFO Colette Kress expects AI infrastructure to reach $3-4 billion by 2030.
TechRadar Pro has reached out to Microsoft for its perspective on the deal. Any update will be posted here.
You might also like
https://cdn.mos.cms.futurecdn.net/h8PtKoPckFsFwU8xPtXRhk.jpg
Source link
