Nebius Group: a hidden technology player with huge potential?

Nebius Group $NBIS is a fast-growing technology company that emerged as a result of the restructuring of Russian tech giant Yandex. After selling its Russian assets and subsequently listing on Nasdaq in October 2024, the company has focused on cloud infrastructure and artificial intelligence (AI).

Given its strong financial position ($2.5 billion in cash), strategic partnerships (e.g. with Nvidia and Grubhub) and aggressive expansion into Western markets, Nebius profiles as an undervalued technology growth stock.

AI & Cloud Infrastructure

-The mainstay of $NBIS - providing computing power for AI models

- Competes with players such as Microsoft (Azure), Amazon (AWS) and Google Cloud

Toloka: Data analytics for AI

- Data collection and evaluation division for training AI models

- Offers services to companies and developers

EduTech (Educational Technology)

- Development of digital educational tools

Avride: Autonomous delivery systems

- Partnering with Grubhub and Uber Eats to deploy 100+ robots on college campuses in the U.S.

Strong expansion and strategic partnerships

New data center in the US (4Q 2024)

Capacity expansion in Europe

AI Studio - a platform for developing AI models

Partnership with Nvidia (NVDA) - leveraging new Blackwell chips

Nvidia owns over 1 million shares of Nebius ($700M investment in December 2024)

Financial growth and valuation

Expected revenue for 1Q 2025: $55M (+45% year-over-year growth)

2025 annual revenue estimate: $750M - $1B

EV/Sales under 5 - cheaper than Microsoft or Amazon

Current share price: $26.80 (up +11.17% on the day)

Risks of investing in Nebius:

Strong competition: Microsoft (MSFT), Amazon (AMZN), Google (GOOGL), Alibaba (BABA) dominate the cloud market

Geopolitical Uncertainty: Despite restructuring and a shift to Western markets, historical ties to Russia remain a concern for investors

Risk of unsustainable growth: rapid expansion may bring financial pressures

Is it worth investing in Nebius Group:

WHY YES?

The fast-growing AI and cloud sector

Strategic partnership with Nvidia

Undervalued valuation relative to competitors

Strong cash position ($2.5B)

What to watch out for?

- Strong competition from tech giants

- Geopolitical risks and transition to Western markets

- Aggressive expansion may increase spending

➡ Conclusion. $NBIS is a hidden player with high growth potential. If the company meets expectations and can compete with established cloud giants, it could be an attractive investment for growth-oriented investors. On the other hand, the risks associated with geopolitics and competition are significant, so it is important to consider personal risk tolerance before investing.