Nvidia invests $700M in ex-Yandex CEO's Nebius Group for AI

The Facts -

Nebius Group Raises $700 Million for AI Infrastructure

AI infrastructure company Nebius Group has secured $700 million in a private placement from notable investors, including Nvidia, Accel, and Orbis Investments. The funding fuels Nebius's mission to advance AI infrastructure globally.

Established in July after a $5.4 billion asset split with Yandex, Nebius focuses on supporting artificial intelligence through robust infrastructure. Founder Arkady Volozh, also the former CEO of Yandex, leads the company from Israel, where a major R&D hub operates.

Nasdaq-listed Yandex's trading paused post Russia's Ukraine invasion but resumed following the asset division. Volozh emphasized that the financing will expedite the creation of GPU clusters and cloud solutions for AI developers.

Nebius plans to invest $1 billion by mid-2025, with potential for increased spending. Arkansas City, Missouri, hosts Nebius's data center space, and potential U.S. expansion is on the horizon, tapping into a client base where over half reside.

The company will issue 33,333,334 Class A shares at $21 each, a 3% premium over Nasdaq's average price since trading resumed. The financing round's oversubscription prompted an increased revenue forecast for 2025, with expectations up to $1 billion.

Additionally, Nebius halted a planned share buyback as investor interest and market dynamics suggest shareholders had ample exit opportunities at favorable prices.

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