NBIS Nebius Group N.V.

Operator (Operator): Welcome to Nebius Group N.V.'s Q4 2025 Earnings Conference Call. The presentation will be followed by a Q&A session. If you would like to ask a question, you can click the Ask a Question tab in the top right of the live stream player. Then just type in your question and click submit. You can submit questions at any time during the presentation, and the Nebius Group N.V. management team will try and answer as many questions as they can during the Q&A portion of the call. I will now hand over to Neil Doshi, VP, Head of Investor Relations, to start the call. Neil Doshi (VP, Head of Investor Relations): Thank you, and welcome to Nebius Group N.V.'s fourth quarter 2025 earnings conference call. My name is Neil Doshi, Vice President of Investor Relations. Joining me today are Arkady Volozh, Founder and CEO, and our broader management team. Our remarks today will include forward-looking statements, which are based on assumptions as of today. Actual results may differ materially as a result of various factors, including those set in today's earnings press release and in our Annual Report on Form 20-F filed with the SEC. We undertake no obligation to update any forward-looking statements. During this call, we will present both GAAP and certain non-GAAP financial measures. A reconciliation of GAAP to non-GAAP measures is included in today's earnings press release. The earnings press release and shareholder letter are available on our website at nebius.com. I will now turn the call over to Arkady Volozh. Arkady Volozh (CEO): Thanks, Neil, and thanks to everyone for joining this call. Well, 2025 was a very strong year for us. Our team did an outstanding job scaling capacity and delivering it to customers with speed and reliability. We also made great progress in developing our own hyperscale AI cloud. But, before going into more detail around our 2025 results, I want to take a step back. It is hard to believe we only launched this company a year and a half ago. At that time, we had built the foundation of a global AI cloud business growing at exponential scale. And we have been operating with very high intensity, building and scaling at extraordinary speed. Today, we are already one of the world's leading and most reliable AI cloud compute providers. We have attracted a diverse pool of clients who value the quality, performance, and flexibility of the platform we built from the ground up. And we have an amazing team who every day seem to do the impossible. And I know they will continue to do so. With this foundation, we are proud of what we have achieved and confident about what we will be delivering. Now back to 2025. As I said, it was an excellent year. We exceeded our financial targets, and we significantly exceeded our capacity plans, setting the stage for the next phase of scale. Demand remains robust, and our pipeline continues to grow substantially. We sold out of capacity in Q3 and Q4 last year, and we are already now in 2026 also sold out. Even before we bring capacity online, it is often sold out. As a result, the average contract duration of new cloud customers grew by 50%, and the prices of GPUs did not fall even on previous generations of GPUs, as the industry may have expected. Customers are demanding more compute and increasingly sophisticated solutions to run their AI workloads. AI startups are quickly evolving to real customers with revenues from their products resonating with real customers. Their demand quickly grows from hundreds of GPUs to tens of thousands. This is already a range the market saw from the biggest customers last year. We are seeing the same trends in the enterprise, who are utilizing AI for more and more vital business processes. Meanwhile, access to compute remains constrained. This imbalance creates a favorable environment for us as we secure and deploy more capacity into a robust demand environment. To capture this opportunity, we are accelerating our capacity plans. Just today, we announced nine new data centers across the globe. Last quarter, we said we would secure 2.5 gigawatts of power by the end of the year. We are already at more than 2 gigawatts now in February, which is why we are raising our forecast for 2026 to more than 3 gigawatts. And we are well on track to deliver 800 megawatts to 1 gigawatt of those as available data center capacity. Just like we spoke about last quarter. Capacity is one of two dimensions of our growth. The other is product. Our main strategic focus is to scale our core AI cloud business, which is our multi-tenant AI cloud. We will expand our platform both organically and through targeted acquisitions that can enhance and accelerate the development of this platform. We recently launched Token Factory, and this is an example, a testament, actually, to our in-house capabilities. And we are also very excited about our recent acquisition of Tavily, which adds agentic search capabilities to our customers and also brings almost 7 ... [transcript truncated at 5,000 chars — full text available via API]

Neil Doshi (Vice President of Investor Relations): Thank you, and welcome to Nebius Group's Third Quarter 2025 Earnings Conference Call. I'm Neil Doshi, Vice President of Investor Relations. Joining me today are Arkady Volozh, Founder and CEO, and our broader management team. Our remarks today will include forward-looking statements, which are based on assumptions as of today. Actual results may differ materially as a result of various factors, including those set forth in today's earnings press release and in our report on Form 20-F filed with the SEC. We undertake no obligation to update any forward-looking statements. During this call, we will present both GAAP and certain non-GAAP financial measures. A reconciliation of GAAP to non-GAAP measures is included in today's earnings press release. The earnings press release, shareholder letter, and accompanying investor presentation are available on our website at nebius.com/investorhub. And now I'd like to turn the call over to Arkady. Arkady Volozh (Founder and CEO): Thanks, Neil, and thank you, everyone, for joining the call today. I'd like to share my thoughts about the demand environment, our capacity plans, and what we're doing in our product. First, about the demand. Q3 demand was very strong. We sold out all of our available capacity. We continue to see a consistent trend: we bring capacity online, we sell all of it. With the new generation of NVIDIA Blackwells coming online, more customers are interested in purchasing capacity in advance and securing it for a longer period of time. Today, we're very pleased to announce that we signed another major deal, this time with Meta, for approximately $3 billion over the next five years. In fact, demand for this capacity was overwhelming, and the size of the contract was limited to the amount of capacity that we had available. Which means that if we had more, we could have sold more. This deal comes on top of the Microsoft deal we announced early September, with a contract value between $17.4 billion and $19.4 billion. As we said before, we expect to sign more of these large long-term deals, and we're delivering on that promise. As busy as we are with these mega deals, our main focus is still to build our own core AI cloud business. We made great progress here with AI-native startups like Courser, Black Forest Labs, and others. The economics and the cash flow of mega deals are attractive in their own right, but they also enable us to build our core AI cloud business faster. This is our real future opportunity. Now on the capacity. In order to meet the growing demand, we have accelerated our plans to secure more capacity, and this is actually our main focus for now. Capacity today is the main bottleneck to revenue growth, and we are now working to remove this bottleneck. As we look to 2026, we expect our contracted capacity to grow to 2.5 gigawatts. This is up from the one gigawatt which we discussed in our previous earnings call in August. Furthermore, we plan to have power connected to our data centers, which means fully built, of approximately 800 megawatts to one gigawatt by the end of 2026. While we made significant investments in our capacity footprint, we're also investing in our main product, our AI cloud. To expand our addressable market opportunity to large enterprise customers, we released our new enterprise-ready cloud platform version 3.0 called Ether, and our new inference platform called Nebius Talking Factory. We believe Ether gives organizations the trust, control, and simplicity they need to run their most critical AI workloads. Nebius Talking Factory is an inference platform that enables organizations to run open-source models with reliability, visibility, and control. And we have a large pipeline of new software and services that we are continuing to build, which will differentiate us from other cloud companies. Based on the strength of demand that we see and our accelerated capacity growth plan, we believe we can achieve an annualized run rate revenue (ARR) of $7 to $9 billion by the end of 2026. In summary, Nebius is positioned to win in this large and rapidly expanding AI cloud market. We're just beginning to realize the powerful potential of the AI evolution that is underway, and we are quickly becoming one of the primary cloud and infrastructure providers to support it. And with this, I would like to hand the call over to our CFO, Dado Alonso. Dado, please. Dado Alonso (CFO): Thank you, Arkady. While the details of our Q3 financial performance can be found in our shareholder letter, I'd like to provide some additional color to the quarter, discuss our financing options, and conclude with 2025 guidance. Q3 group revenue was $146 million, up nearly 355% year over year and 39% quarter over quarter. Annualized run rate revenue for the core business at the end of September was $551 million. The core infrastructure business, which accounted for nearly 90% of total revenue, grew 400% year ov ... [transcript truncated at 5,000 chars — full text available via API]

Operator (Operator): Thank you, and welcome to Nebius Group's Second Quarter 2025 Earnings Conference Call. Joining me today are Arkady Volozh, Founder and CEO; and our broader management team. Our remarks today will include forward-looking statements, which are based on assumptions as of today. Actual results may differ materially as the results of various factors, including those set forth in today's earnings release and in our annual report on Form 20-F filed with the SEC. We undertake no obligation to update any forward-looking statements. During this call, we will present both GAAP and certain non-GAAP financial measures. A reconciliation of GAAP to non-GAAP measures is included in today's earnings press release. The earnings press release, shareholder letter and accompanying investor presentation are available on our website at group.nebius.com/investor-hub. And now I'd like to turn the call over to Arkady. Arkady Volozh (CEO): Thanks, Neil, and thank you to everyone for joining the call today. I'm pleased to report that we had an excellent quarter. We more than doubled our revenue for the group from Q1, and this quarter we also achieved EBITDA positivity in our core AI infrastructure business earlier than we had anticipated. While we could grow faster, we were oversold on our supply of previous generation hoppers, so we chose to wait for the new generation of GPUs. The new Blackwells are coming to market in large quantities, and we are significantly increasing our data center capacity. Consequently, we expect to see a substantial rise in our sales by the end of this year, which is why we are raising our ARR guidance for year-end from the previous $700 million to $1 billion to a new range of $900 million to $1.1 billion. Regarding our capacity, I see this as one of the key updates of this call. We are aggressively ramping up. By year-end, we expect to secure 220 megawatts of connected power that is either active or prepared for GPU deployment, including our data centers in New Jersey and Finland. Additionally, we are close to finalizing two significant new greenfield sites in the U.S. Overall, we are working to secure over 1 gigawatt of power by the end of 2026 to capture industry growth next year. We've also made significant enhancements to our software cloud platform to support our expanding capacity and address the demand for large-scale clusters. Furthermore, we are continuously expanding our customer base. We have started to gain real traction on the enterprise front, adding large global technology customers like Cloudflare, Prosus, and Shopify. We continue to be a leading cloud provider for native AI tech startups, adding clients such as HeyGen, Lightning.AI, Photoroom, and many others. On the financing side, as you know, we are fortunate to have various options to fund our ambitious growth. We have raised over $4 billion in capital to date. We maintain a robust balance sheet and have access to potentially billions more thanks to our noncore businesses and other equity stakes in companies like Avride, ClickHouse, and Toloka. In summary, this is an exciting time for Nebius. We are in a unique position to seize a once-in-a-generation opportunity, as we believe the demand for AI compute is strong and will only continue to grow. We are rapidly increasing our capacity to pave the way for accelerated growth in 2026 and beyond. With that, let me introduce our new Chief Financial Officer, Dado Alonso. Dado, welcome again, and the floor is yours. Dado Alonso (CFO): Thank you, Arkady. I'm really excited to be joining Nebius. I've long believed that AI will fundamentally transform our world, and Nebius is well positioned to make that happen. Of course, I'm also looking forward to getting to know our investors and analysts over the coming months. While the details of our Q2 financial performance can be found in our shareholder letter, I'd like to highlight a few key items and then conclude with guidance. We reported $105.1 million in revenue, up 625% year-over-year and up 106% quarter-over-quarter, driven by strength in our core business and solid execution from our Tripleten team. Our AI cloud infrastructure revenue increased more than 9x year-over-year, driven by strong customer demand for our copper GPUs and near peak utilization of our platform. Even as we achieve hyper growth, we continue to operate with discipline. This focus allowed us to achieve positive adjusted EBITDA in our core business ahead of our expectations. Below the operating income/loss line, we recorded a gain from revaluation of investment in equity securities related to our equity investment. We also reported a gain from discontinued operations. These 2 non-business-related items made for the quarter GAAP net income profitable. It is important to notice that we view these gains as onetime in nature. Turning to guidance. We see very strong momentum in our business and demand for AI compute remains exceptionally high. Given our plans ... [transcript truncated at 5,000 chars — full text available via API]

Neil Doshi (CEO): CEO and members of the management team. Our remarks today will include forward-looking statements, which are based on assumptions as of today. Actual results may differ materially as a result of various factors, including those set forth in today's earnings press release and in our annual report on Form 20-F filed with the SEC. We undertake no obligation to update any forward-looking statement. During the call, we will present both GAAP and certain non-GAAP financial measures. A reconciliation of GAAP to non-GAAP measures is included in today's earnings press release. The earnings press release and accompanying shareholder letter and an investor presentation on our website at group.nebius.com/investor-hub. We ask that you enter your questions into the webcast portal, and we will be reviewing and consolidating the questions for Q&A. And now I'd like to turn the call over to Arkady and the team, who will go over a few slides that we've presented for this investor presentation. Arkady Volozh (CEO): Yes. Thanks. Thanks, Neil. Thank you, everyone, for joining our Q1 2025 results call. I will start by saying that demand for AI compute was very strong in the first quarter. Our results show it. Our revenue grew nearly 400% year-over-year, and our annualized run rate revenue grew nearly 700%. We saw great momentum in our core infrastructure business. We ended the quarter with a solid cash balance of $1.4 billion and we actually continue to invest in our infrastructure. To that point, we are rapidly building our capacity to serve customers around the world. This is a global race as you understand, and we are well-placed with our footprint in the U.S., Europe, and now in the Middle East. As you can see here on the slide, we added three new locations recently, and there is more to come. We're exploring new locations for capacity build-out, and we hope to share more news with you very soon. We also announced some new partnerships this quarter to strengthen our relationship with NVIDIA as well as Meta and Llama. And finally, we had a very productive quarter with respect to building out our technology stack, and we are getting industry recognition for our AI cloud offering. For example, SemiAnalysis ranked us in the GPU Cloud ClusterMAX rating system. Now I'll hand over to Andrey Korolenko to discuss some of the key products we launched in Q1. Andrey Korolenko (CTO): Thank you, Arkady, and hello, everyone. We believe the depth and the quality of our care significantly differentiate us against the other Neoclouds. We made great progress in Q1 in further developing our AI cloud offering and had a number of notable product launches. We launched the Slurm-based cluster upgrades such as automatic recovery for failed nodes, proactive system health checks, and detecting issues before jobs actually fail. These changes reduce downtime for customers and improve capacity availability on our infrastructure, which led to around 5% improvement in available nodes for commercial use, which is quite significant. Several platform services were released and moved from the beta phase to general availability, MLflow, and JupyterLab notebook as examples, but there was much more. We invested a lot of time and effort in the reliability and performance of the platform. Notably, we launched an enhanced object storage, which ensures that large data sets can be accessed and saved quickly during model training runs, reducing client waiting times. Building on that foundation of our homegrown storage capabilities, we have also partnered with three leading storage providers such as DDN, VAST, and WEKA. This enables us to deliver the best possible experience for all customer scenarios going forward with the Blackwell generation clusters. Last, but not least, we expanded integrations with external AI platforms such as Metaflow, dstack, and SkyPilot, which allows customers to bring existing workloads into our ecosystem with minimal friction. Now I'll hand it over to Daniel. Daniel Bounds (CRO): Thanks, Andrey. In addition to strengthening our product in Q1, we also made significant progress toward expanding our partner ecosystem. From further building out our data storage solution portfolio, as Andrey mentioned, with industry leaders, we extended our core AI cloud capabilities to the ISV landscape with tight technical integration, and we made announcements enabling customers to consume Nebius infrastructure across a wide segment of the industry. Equally important are the relationships we have with the full range of AI marketplaces and established channel partners that help us meet customer demand for our AI infrastructure across the globe. I'd also like to talk about NVIDIA. As you know, NVIDIA is an investor in our company. We have a long history of working with the NVIDIA team, and we want to continue to build on that relationship. In Q1, we made several announcements with them. First, in the Q1 timeframe, Nebius and NVIDIA announced ... [transcript truncated at 5,000 chars — full text available via API]

Neil Doshi (Head of Investor Relations): Hello, and welcome to Nebius Group's Fourth Quarter and Full Year 2024 Earnings Conference Call. My name is Neil Doshi, Head of Investor Relations. Joining me today to discuss our results are Arkady Volozh, Founder and CEO, and the rest of the Nebius management team. Before we get started, I would like to take this opportunity to remind you that our remarks today will include forward-looking statements. Actual results may differ materially from those contemplated by these forward-looking statements. Factors that could cause these results to differ materially are set forth in today's earnings press release and in our quarterly report on Form 6-K filed with the SEC. Any forward-looking statements that we make on the call are based on assumptions as of today, and we undertake no obligation to update these statements as a result of new information or future events. During this call, we will present both GAAP and certain non-GAAP financial measures. A reconciliation of GAAP to non-GAAP measures is included in today's earnings press release. The earnings press release is available on our website at group.nebius.com/investor-hub. And now, I'd like to turn the call over to Arkady. Arkady Volozh (Founder and CEO): Thank you, Neil, and welcome everyone to our fourth quarter earnings call. As we said on our last call, our aim is to build one of the world's largest AI infrastructure companies. We believe that we are well positioned to do this because we have a proven track record of building and running efficient data centers with stable power, delivering GPU-based AI compute infrastructure, cloud, and offering a wide range of value-added services to businesses that are adopting GenAI. Since we publicly launched Nebius in July of last year, just seven months ago, we have been extremely focused on putting in place the foundation to support our future growth in '25 and beyond. I'd like to share what we accomplished in the fourth quarter alone. First, we resumed trading as a public company in October, becoming the first publicly traded AI specialized cloud. This came much faster than expected as we were still building our corporate and business functions. We also raised $700 million in capital in December in an oversubscribed offering, a deal that saw the likes of NVIDIA, Accel, Orbis, and others enter our capital structure. On the infrastructure side, we successfully expanded our data center footprint and our GPU deployments, and we are building the foundation which will enable us to aggressively scale up this year in the US and Europe. Also, we launched our new AI cloud platform and migrated all of our customers to it in Q4. We also launched our Inference-as-a-Service platform called AI Studio. And we made great progress in building our global sales and marketing team with a particular focus on the US market. In that context, I'm very pleased with everything we were able to accomplish in Q4. Our sales function is now up and running and we are seeing the results. More clients are coming onto the platform and our more diversified customer base is already contributing to strong growth run rate revenue. Based on the contracts already in place, March analyzed run rate revenue will be at least $220 million, and we have more potential contracts in the pipeline. Given this momentum, as well as the anticipated impact of additional data center capacity that we're building and the next-generation Blackwell's GPU coming online later this year, our projected December 2025 analyzed run rate revenue of $750 million to $1 billion is well within reach. Looking ahead to 2025, we have three strategic focus areas. The first is our unique full-stack AI technology. In addition to our European data centers in Finland and France, we started deploying GPU clusters in Iceland and in Kansas City, which was the first capacity in the US for us. Also, we will soon announce our first US data center built to our own design. We will continue to enhance and expand our AI cloud and Inference-as-a-Service platforms. The second area of focus is the capital to invest in our future growth. At the end of last year, we had $2.4 billion in cash, including the $700 million raised in Q4 from high-quality investors. Being a public company also gives us access to a wide variety of efficient financing options. Finally, another focus point is our corporate structure. We have been particularly focused on our sales and marketing and customer support teams. We made great hires from within our industry in the last quarter and we are already seeing positive results in terms of run rate revenue growth as we start 2025. Additionally, our business units are doing very well. Avride, our autonomous technology platform, signed a contract with Uber as one of just two autonomous technology partners in the US, along with Waymo and Zoox. Uber Eats has already deployed Avride robots for food delivery in Austin, Dallas, and Jersey City. Avrid ... [transcript truncated at 5,000 chars — full text available via API]