NVIDIA Loves Nebius Group (NBIS) And This Is Why You Should Buy It Too

Nebius is a dynamic player in the Artificial Intelligence (AI) industry. Nvidia’s (NASDAQ:NVDA) connection with Nebius has given the stock a strong boost and attracted investor attention. It helps outfit data centres with Nvidia GPU architecture and provides access to the infrastructure through cloud. The company is working on expanding its global footprint, and now is the right time to bag the stock.

Nebius had announced a private placement financing worth $700 million last year, and Nvidia took part in it. Both companies enjoy a close partnership, which is expected to benefit Nebius. The company has already reported impressive numbers and is making its presence felt in the rapidly growing AI infrastructure industry. The cloud AI infrastructure market represents a $400 billion opportunity, and Nebius is poised to capitalize on it.

AI Infrastructure industry is a billion dollar market

Nebius allows customers to scale from a single GPU to large language models to build apps. It offers the top Nvidia GPUs to its customers and also claims that it is the first to gain access to its Blackwell Platform. Nebius has become a big part of Nvidia and is assisting it roll out the latest GPUs globally. As Nvidia grows, Nebius will follow.

Nebius has seen strong revenue growth, which was up about 300% year-over-year in the recent quarter at $55.3 million. It has expanded and gone from a single location to five data centres in just three quarters. The management is aiming for a revenue in the range of $500 million to $700 million this year.

One thing to remember is that Nebius is only getting started, and there’s a lot more to come. It is building a strong revenue pipeline, and the management aims to achieve an annualized run rate (ARR) of $750 million to $1 billion by the end of this year. The company has a strong balance sheet with a cash balance of $1.4 billion and only $187 million in debt.

This will allow it to increase the data center capacity across new locations. 2026 could be a crucial year for Nebius as it could enter new partnerships, expand the data centres, and report robust financial results. The company is set to report quarterly results on August 7, and I think the stock is a buy before that.

Wall Street is bullish on the stock

Goldman Sachs is bullish on the stock with a price target of $68 and a buy rating. The firm believes that Nebius is a strong player in the AI infrastructure industry and is very well positioned. DA Davidson has a buy rating with a price target of $55 and BWS Financial has a buy rating with a price target of $80.

Nebius stock is exchanging hands for $54, up 78% year-to-date and 172% in 12 months. I believe the company has the potential to keep growing, and its steady growth justifies the valuation. It is an ideal pick for investors right now. If you wait too long, the stock might become very expensive.

Investors looking to buy a Nvidia-backed company mustn’t miss out on Nebius stock.