Nebius (NBIS) Q4 2025 earnings review
Hyper-Growth Meets First Profitability Milestone
Nebius delivered a breakout quarter, with revenue skyrocketing 547% YoY to $227.7M, accelerating from the 355% growth seen in Q3. Critically, the company achieved its first quarter of positive Adjusted EBITDA ($15.0M), proving the core AI business can scale profitably despite massive infrastructure costs. However, the 'land grab' strategy is expensive: CapEx surged to ~$2.1B in Q4 alone, driving a widening GAAP Net Loss of $250M due to heavy depreciation. Management is betting the farm on capacity, with cash burn now the primary metric to watch.
🐂 Bull Case
Adjusted EBITDA flipped to positive $15.0M from a $63.9M loss a year ago. This inflection point arrived alongside triple-digit revenue growth, validating the unit economics of the core AI infrastructure business.
Revenue growth accelerated to 547% YoY (up from 355% in Q3). Sequential growth remains robust at ~56% QoQ ($146M to $228M), indicating demand still far outstrips supply.
🐻 Bear Case
CapEx hit a staggering ~$2.1B in Q4 (derived), more than double the Q3 spend. While the cash position is strong ($3.7B), this burn rate requires flawless execution to avoid future liquidity crunches.
Despite positive EBITDA, GAAP Net Loss from continuing operations widened to $249.6M (vs $123M YoY). Depreciation costs exploded to $180.7M (up 443%), a heavy structural weight that will persist for years.
⚖️ Verdict: 🟢
Bullish. Nebius is executing a classic infrastructure blitzscaling playbook perfectly. The flip to positive Adjusted EBITDA is the 'checkmate' move that differentiates them from unprofitable cash furnaces. The risk is now purely operational (deploying $2B+ of hardware effectively).
Key Themes
The $2 Billion CapEx Quarter
Nebius is aggressively capitalizing on the AI arms race. Purchases of property and equipment (CapEx) for Q4 alone reached ~$2.06B, bringing the full-year total to over $4B. This massive acceleration (up from ~$956M in Q3) signals confidence in demand but significantly raises the execution stakes.
Gross Margin Expansion
Economies of scale are kicking in. Cost of Revenues as a percentage of Revenue dropped dramatically to 30% in Q4 from 60% a year ago. This structural improvement drove the Gross Profit to ~$159M (implied ~70% margin), providing the fuel for Opex leverage.
Depreciation Drag
The downside of the 'land grab' is the depreciation bill. D&A expenses surged 443% YoY to $180.7M in Q4. This non-cash charge is the primary reason GAAP Net Income remains deeply negative (-$249.6M) despite the operational turnaround.
Agentic AI Expansion (Tavily Acquisition)
Moving up the stack, Nebius announced the acquisition of Tavily to integrate 'agentic search' into its platform. While financial details weren't disclosed, this signals a strategy to capture value beyond raw compute by offering tools for the next generation of AI agents.
Shareholder Dilution
The total number of shares issued and outstanding rose to ~253 million at year-end 2025, up from ~236 million a year prior. With Share-Based Compensation (SBC) running at ~$25M/quarter and an active ATM program mentioned in Q3, dilution remains a funding lever for the massive CapEx requirements.
Other KPIs
Strong liquidity position, up from $2.4B a year ago, largely due to financing activities. This war chest is critical given the ~$2B quarterly CapEx run rate.
Reversing. Improved from -181% in 24Q4 and -3.6% in 25Q3. The first instance of positive margin indicates the business model works at scale.
Stable/Efficient. Grew only 66% YoY compared to Revenue growth of 547%. As a percentage of revenue, R&D plummeted from 91% to 23%, showing massive operating leverage.
Guidance
Stable. Confirms the technological roadmap remains on track to offer next-generation infrastructure in the US and Europe.
The press release text did not contain specific financial guidance tables for FY26. Investors will need to look to the earnings call or presentation for updated ARR and Revenue targets.
Key Questions
FY26 Revenue & CapEx Outlook
With Q4 CapEx hitting $2B and Revenue at $228M, what are the specific targets for FY26? Is the $2B/quarter spend the new normal?
Customer Concentration Risks
Q4 growth was explosive—was this driven by the ramp of the previously announced Microsoft/Meta deals, and how much of 25Q4 revenue is concentrated in top 3 customers?
Tavily Acquisition Integration
How does the Tavily acquisition impact the P&L in FY26, and does this mark a shift towards more M&A to build out the software layer?
Capital Adequacy
With ~$3.7B in cash and a ~$2B quarterly burn rate implied by Q4 CapEx, do you anticipate needing to raise additional capital in FY26?