Nebius secures $700M backing from Nvidia, Accel to expand AI infrastructure and U.S. operations
Nickie Louise
Posted On December 2, 2024
The company revealed the funding was oversubscribed, pushing its projected annualized revenue by the end of 2025 to a range of $750 million to $1 billion, up from a previous estimate of $500 million at the lower end. This follows a $1 billion raise just two months ago aimed at expanding AI infrastructure in Europe by mid-2025.
Nebius was established in July as part of a $5.4 billion deal to separate the domestic and international operations of Yandex, Russia’s leading internet company. The move positioned Nebius to focus on building infrastructure critical for artificial intelligence.
Founded by Arkady Volozh, the former CEO of Yandex, Nebius is pushing ahead with plans to scale its AI capabilities. Volozh highlighted that the latest financing will accelerate the development of GPU clusters, cloud platforms, and other tools for AI developers.
While Nebius has committed $1 billion toward its initiatives by mid-2025, Volozh noted the company might increase its investments. Currently leasing data center space in Kansas City, Missouri, Nebius is also considering further expansion in the United States, where more than half its clients are based.
According to Reuters, Nebius will issue 33,333,334 Class A shares at $21 each in the private placement, a 3% premium to the average trading price since Nasdaq resumed trading for the stock. The company also announced it will no longer pursue a previously approved share buyback plan.
“Based on the strong level of investor engagement and technical dynamics which we have observed following the resumption of trading on Nasdaq, we believe that those shareholders who may have wanted to exit have had an opportunity to do so at a price higher than the maximum repurchase price authorized by shareholders,” Nebius Board Chairman John Boynton said.
Even before the split Russian tech giant Yandex, Nebius has already established itself as a key player in Europe, especially with its energy-efficient data center in Mäntsälä, Finland. The company’s expansion strategy includes building new data centers across Europe, securing agreements for additional sites, and increasing capacity at their current facilities. Since the start of the year, they’ve already deployed around $200 million, moving towards tens of thousands of GPUs to power their AI cloud services globally.
Back in July, a Russian consortium completed a $5.4 billion deal to acquire Yandex’s Russian assets, marking one of the largest corporate exits since Russia’s invasion of Ukraine. Nebius, now independent from its Russian ties, is gearing up to become a major force in AI infrastructure, according to Volozh.
The Nebius Group portfolio includes data partner Toloka AI, edtech business TripleTen, and self-driving tech unit Avride. Though the company has inherited Yandex’s Nasdaq listing, trading remains on hold for now.
As part of its expansion, Nebius is investing in boosting GPU capacity, including the Paris-based GPU cluster, featuring Nvidia GPUs. With plans to build two more data centers in Europe and extend its Finland operations, Nebius is setting the stage for significant growth in the AI space.
