Nebius had a strong quarter on the metrics it controls most directly: revenue and profitability both grew faster than management's own cautious guidance implied. The GAAP net loss is mostly explained by a one-time gain that did not repeat last year, not by weaker operations. The real story sits below those numbers. Nebius is spending on infrastructure at a scale far beyond what the business currently earns, and it is funding much of that gap through debt and customer prepayments rather than cash generated internally. Demand looks genuinely strong, backed by a large Meta agreement and a growing contracted backlog. What matters next is whether Nebius can turn that demand into running, billable capacity fast enough to keep funding itself on reasonable terms.
Third-party analysts had modeled revenue of roughly $570M-$580M heading into the print; this is an aggregated estimate, not a company-reported figure.
Revenue grew 454% year-over-year to $582.3M, up 46% from Q1's $399.0M, as newly built infrastructure came online and found paying customers quickly. Adjusted EBITDA, a profitability measure that excludes depreciation, share-based compensation, and financing costs, expanded to a 40.6% margin from 32.5% in Q1. Cost of revenue, product development, and administrative costs all fell as a share of revenue together, suggesting the improvement is broad rather than one favorable line.
Customers are committing to Nebius well ahead of using its capacity. Deferred revenue, cash collected before service is delivered, grew to $5.98B from roughly $1.6B at the end of 2025. Total contracted revenue not yet delivered reached $33.6B, helped by a five-year agreement with Meta worth up to $27B. That points to demand exceeding what Nebius can currently build, not a shortage of customers.
Turning that demand into revenue required spending $5.66B on infrastructure in the quarter alone, and $8.13B across the first half of the year, roughly 24 times the quarter's adjusted EBITDA. Much of it was funded through new debt and customer prepayments rather than cash the business generated on its own, which is the central financial question the rest of this report works through.
Two numbers matter most this quarter, and they point in different directions. Adjusted EBITDA, Nebius's preferred profitability measure, rose to $236.2M, a 40.6% margin, showing that capacity already running is becoming genuinely profitable. But adjusted EBITDA excludes depreciation, share-based compensation (stock granted to employees as part of pay), and financing costs, three of the largest expenses this business actually carries. Include them, and Nebius reported a GAAP net loss of $190.4M, against net income of $502.5M a year ago. Most of that swing is explained by a one-time investment gain that did not repeat, but not all of it: operating losses widened in dollar terms too, and share-based compensation rose 597% to $102.5M.
Company-reported quarterly revenue
The bigger gap sits in cash. Operating cash flow for the first half of the year looked strong at $4.50B, but deferred revenue alone grew by roughly $4.4B over the same period. Customer prepayments supplied much of that inflow. That money is real and helps fund the buildout today, but Nebius still owes the corresponding service, so it isn't the same as free cash flow, the cash left over after running and building the business. Even with that boost, operating cash flow fell about $3.6B short of the $8.13B spent on infrastructure in the first half, meaning debt and new share issuance covered the rest.
Nebius does not appear to have a shortage of customers. Its challenge is turning contracts, power rights, and construction spending into capacity that is actually running and billing customers.
Contracted power, land and electricity rights secured for future data centers, stood at more than 3.5 gigawatts as of the Q1 2026 update, against a year-end target of more than 4 gigawatts. Connected power, capacity actually wired and able to operate, is targeted at only 800 megawatts to 1 gigawatt by year-end, a much smaller number. That gap between contracted and connected power is the real bottleneck: securing sites and power is necessary but not sufficient, and construction and commissioning simply take time.
The Meta agreement shows the same distinction at the contract level. Of the up-to-$27B deal signed in March, $12B is committed, dedicated capacity with delivery starting in early 2027. The remaining $15B is an option for Meta to buy additional capacity Nebius is building for other customers, real but conditional, not a guaranteed commitment. Only about 29% of the company's $33.6B in contracted revenue is expected to convert within 24 months, so most of this backlog is a multi-year story, not a near-term one.
Cash more than doubled in six months, but so did debt, and shareholders' equity roughly doubled too, mostly through new capital raised rather than retained profit, since the business is still loss-making on an adjusted basis. Nebius funded the first half through a mix of debt, treasury share sales, warrant issuance, and customer prepayments, not from operations alone.
Nebius has substantial liquidity, but its capital program is so large that the cash balance cannot be judged on its own. It has to be weighed against the debt taken on to fund it, the service still owed to prepaying customers, and the dilution shareholders are absorbing to keep the buildout financed.
Continued debt issuance, warrant sales, and $102.5M of quarterly share-based compensation mean shareholders are funding part of this buildout through dilution, on top of rising debt. That is a normal cost of a capital-intensive growth story, but it is a real cost, not a footnote.
H1 2026 revenue totaled $981.3M. Full-year guidance of $3.0B to $3.4B was set alongside the Q1 2026 results and was not restated with new figures in the Q2 release itself, so it should be read as standing guidance rather than a fresh reaffirmation. Reaching it requires H2 2026 revenue of roughly $2.02B to $2.42B, an average of $1.01B to $1.21B per quarter, against Q2's actual $582.3M.
Illustrative scale, using the guidance range for the H2 segment
Nebius must deliver another substantial, capacity-driven acceleration in the second half. The guidance is plausible only if connected and commissioned capacity rises quickly enough to match it.
Q2 proved Nebius can grow extremely fast and improve profitability on the metrics it controls directly. Revenue, margin, and contracted demand all moved in the right direction, and broadly, not from one favorable item.
It did not yet prove the business can fund its own growth. Infrastructure spending remains far larger than adjusted EBITDA, and a meaningful share of this quarter's cash improvement came from money customers paid in advance rather than underlying profit.