NBIS Stock Plunge Analysis: High-Risk AI Infrastructure Opportunity Amid Major Contracts and Dilution Concerns

This analysis is based on a Reddit discussion [1] on November 13, 2025, highlighting NBIS (Nebius Group N.V.) stock’s dramatic decline and questioning whether it represents a buying opportunity. The stock has fallen 30.34% over the past 30 days to $88.63, despite the company securing transformative contracts with major tech giants and reporting impressive revenue growth. The situation presents a complex risk-reward scenario involving fundamental strength versus significant execution and valuation concerns.

NBIS is experiencing a severe correction, down 6.07% on the day and 30.34% over the past month, despite remaining up 377.28% year-over-year [0]. The decline follows Q3 2025 earnings on November 11, where the company reported $146 million in revenue (up 355% YoY) but a net loss of $119.6 million, significantly wider than the prior year’s $43.6 million loss [1]. The stock fell from its 52-week high of $141.10, creating the dip scenario discussed on Reddit [1].

The company’s business fundamentals appear robust with major contract announcements including a $3 billion five-year agreement with Meta Platforms and a $17.4-19.4 billion deal with Microsoft announced in September [1]. Management projects ARR of $7-9 billion by end of 2026. However, financial metrics reveal serious concerns: P/E ratio of 103.06x, price-to-sales ratio of 93x, and mounting losses despite revenue growth [0][1]. The company sold out all available capacity in Q3, with CEO noting demand exceeded supply [1].

Nebius announced an at-the-market equity program for up to 25 million Class A shares, signaling significant potential dilution [1]. The company plans to raise capital through corporate debt (already exceeding $4 billion), asset-backed financing, and equity issuance. Additionally, CapEx guidance was raised dramatically from ~$2 billion to ~$5 billion for 2025 to accelerate capacity expansion [1].

There’s a significant split between bullish analysts maintaining 100% Buy ratings with $101 price targets [0] and bearish concerns about valuation and execution risks [2]. The Reddit discussion [1] reflects retail investor optimism based on product experience and fundamentals, while institutional analysis focuses on financial sustainability.

The company’s challenge is unusual - having more demand than available capacity. While this demonstrates strong market positioning, it also creates execution risks as the company races to scale infrastructure to meet contractual obligations [1][2].

Major revenue from Microsoft and Meta deals is expected to begin in 2026 [1], creating a near-term funding gap that the equity program and debt financing aim to bridge. This timing mismatch contributes to current market skepticism.

• Dilution Risk
  : The 25M share ATM program could significantly dilute existing shareholders [1]
• Execution Risk
  : Aggressive $5B CapEx expansion requires substantial operational execution [1][2]
• Valuation Risk
  : Current multiples of 103x P/E and 93x price-to-sales are extremely high even for growth stocks [0][2]
• Supply Chain Constraints
  : NVIDIA GPU availability and data center construction delays could impact growth [2]
• Profitability Timeline
  : No clear path to positive earnings, with losses widening [1]

• Contract Ramp-up
  : Microsoft and Meta revenue recognition beginning in 2026 could drive significant growth [1]
• Market Position
  : Strong demand exceeding supply indicates competitive advantage in AI infrastructure [1]
• Analyst Support
  : 100% Buy ratings suggest institutional confidence despite current volatility [0]
• AI Infrastructure Growth
  : Continued demand from hyperscalers supports long-term thesis [1][2]

NBIS presents a high-risk, high-reward investment scenario. The company has secured transformative contracts with Meta ($3B) and Microsoft ($17.4-19.4B) and demonstrates strong demand with 355% YoY revenue growth [1]. However, the stock decline reflects legitimate concerns about extreme valuation (103x P/E), mounting losses ($119.6M in Q3), and significant dilution risk from a 25M share equity program [0][1].

The company faces capacity constraints requiring accelerated $5B CapEx spending, creating near-term execution challenges [1]. While analysts maintain bullish $101 price targets [0], the path to profitability remains unclear, and the timing mismatch between current expenses and future revenue recognition creates financial uncertainty [1][2].

Investors should monitor capacity expansion progress, contract execution milestones, and the company’s ability to manage its capital structure while scaling operations to meet unprecedented demand in the AI infrastructure market.