Nebius cuts 2026 revenue forecast as data center delays hit growth
What happened
Nebius, an AI cloud provider, reduced its revenue forecast for 2026 after delays at a major Microsoft data center in New Jersey. The company announced it will increase its planned spending for 2027 to $40-45 billion, relying on customer pre-payments and loans to fund new data centers. Despite these setbacks, Nebius reported a 571% increase in revenue for the third quarter. The delays have affected the timeline for delivering services to Microsoft, one of Nebius's largest clients.
Key details
- Nebius's Q3 revenue reached $981 million, a 571% year-over-year increase.
- The company lowered its 2026 revenue forecast by $200 million, now expecting $3 billion.
- Planned capital expenditure for 2027 is set at $40-45 billion.
- Nebius's contract with Microsoft for the New Jersey data center is valued up to $19.4 billion.
- New Jersey regulators fined the data center operator $1.1 million for permit violations.
Why it matters
Customers and investors in Nebius are directly affected by the lowered 2026 revenue outlook and the risk of further delays or penalties tied to major contracts. Companies like Microsoft and Meta, which have pre-paid for AI computing capacity, face uncertainty about when their services will be delivered. Nebius's reliance on prepayments and loans for funding increases financial exposure if project timelines slip, and regulatory issues at third-party sites add further risk to its growth plans.