Nebius Group NV (NBIS) is having a much better Tuesday than it had last week. The AI infrastructure provider's shares jumped more than 6% Tuesday afternoon, staging a comeback after getting hammered following a third-quarter earnings report that left investors decidedly unimpressed.
What Spooked Investors Last Week
The damage came after Nebius reported third-quarter revenue of $146.1 million, falling short of Wall Street's $153.7 million estimate. Making matters worse, the company's full-year revenue guidance of $500 million to $550 million came in well below the roughly $578 million analysts had been expecting.
Then there was the dilution worry. Nebius announced an equity distribution agreement that would allow it to sell up to 25 million Class A shares, which didn't exactly thrill existing shareholders. The stock dropped nearly 9% as investors headed for the exits.
Why Tuesday Feels Different
But here's the thing: sometimes the market overreacts, and Tuesday's bounce suggests investors are taking a fresh look at what Nebius is actually building. Despite the guidance reset, the company delivered roughly 237% year-over-year revenue growth. That's the kind of number that makes you look twice.
More importantly, Nebius isn't slowing down its expansion plans. The company recently announced a massive $3 billion, five-year infrastructure deal with Meta Platforms and plans to expand its compute capacity to 2.5GW by 2026. That positions Nebius as a significant player in the AI data-center build-out that's reshaping the tech landscape.
What The Analysts Think
Wall Street's reaction has been mixed but generally optimistic. Analysts at Northland Capital Markets are particularly bullish, slapping a $211 price target on the stock. D.A. Davidson reiterates a $150 target and calls Nebius a "top AI pick," arguing that last week's selloff might actually be a chance to buy the stock on the cheap.
The momentum data backs up some of that optimism. Nebius holds a strong 98.57 Momentum score, showing solid medium- and long-term uptrends, though short-term sentiment remains shaky following last week's turbulence.
The Bottom Line
Tuesday's rally came even as broader tech benchmarks traded mostly lower, suggesting Nebius is moving on its own storyline rather than just riding market momentum. Nebius shares were up 6.58% at $91.64 at the time of publication Tuesday.
The question for investors now is whether this bounce represents a real reassessment of the company's prospects or just a temporary relief rally after an oversold condition. With 237% revenue growth and billions in infrastructure deals on the books, Nebius certainly has the ingredients for a compelling growth story. Whether the market fully buys that narrative again remains to be seen.
