Nebius $NBIS targets 220MW connected power by end-2025 to accelerate AI GPU deployments

In the race to dominate AI infrastructure, the subtleties of power metrics can make or break investor expectations. For Nebius Group (NASDAQ: NBIS), recent guidance on capacity expansion reveals a critical distinction between connected power and contracted power—one that underscores the company’s aggressive push into data centre scaling but also highlights potential bottlenecks in GPU deployment timelines.

Decoding Power Metrics in AI Infrastructure

At the heart of Nebius’s growth narrative lies the differentiation between connected power and contracted power. Connected power encompasses not only the electricity currently in use but also capacity that is fully provisioned and ready for immediate activation once hardware like GPUs is installed. This metric reflects a more advanced stage of readiness, where infrastructure is essentially “plug-and-play” for new compute resources. In contrast, contracted power represents commitments secured with utility providers or data centre operators, often involving longer lead times for actual energisation due to regulatory approvals, grid upgrades, or construction phases.

This nuance is pivotal because it directly impacts how quickly Nebius can translate expansion plans into operational capacity. For instance, while contracted power signals future potential, connected power is the real enabler of rapid GPU installations, allowing the company to meet surging demand for AI workloads without delays. Industry observers note that in the hyperscale data centre space, mismatches between these metrics have tripped up several players, leading to underutilised assets or missed revenue opportunities.

Nebius’s Expansion Guidance Under the Microscope

Nebius has outlined ambitious targets, aiming for 220 megawatts (MW) of connected power by the end of 2025, with more than 1 gigawatt (GW) anticipated by the close of 2026. This builds on current deployments, including expansions in Finland and the United States. According to company announcements, the Mäntsälä data centre in Finland is set to triple its capacity to 75 MW, potentially housing up to 60,000 GPUs and generating over $1 billion in annual revenue at full utilisation. Similarly, a new build-to-suit facility in New Jersey could add up to 300 MW, with initial phases expected online as early as summer 2025.

These figures, drawn from Nebius’s recent disclosures, emphasise connected power as the benchmark for near-term growth. As of the latest updates, the company has already secured over 100 MW in active or immediately activatable capacity, surpassing prior estimates. However, the gap between connected and contracted power introduces execution risks—supply chain hurdles for GPUs, such as those exacerbated by U.S.–China trade tensions, could delay installations even if power is provisioned. Analyst sentiment from sources like AInvest highlights this, with reports noting that while Nebius’s AI cloud revenue surged more than ninefold year-over-year in Q2 2025, positive adjusted EBITDA in the core business came ahead of expectations due to high utilisation rates.

To contextualise, Nebius’s stock closed at $68.78 on Nasdaq as of 10 August 2025, marking a 5.31% daily gain and a staggering 243.90% rise over the past 52 weeks. This valuation, with a price-to-book ratio of 4.98 and market capitalisation exceeding $16 billion, reflects investor optimism about the company’s ability to bridge power metrics into tangible growth. Yet, the forward price-to-earnings remains undefined amid negative EPS estimates for the current year at -1.39, underscoring the capital-intensive nature of these expansions.

Implications for GPU Installation and Data Centre Growth

The interplay between connected and contracted power has profound implications for Nebius’s GPU rollout strategy. With connected power, the company can accelerate installations, capitalising on near-peak utilisation of platforms like its AI cloud infrastructure. This is particularly advantageous in Europe, where Nebius is investing over $1 billion by mid-2025 in build-to-suit data centres and colocations, including a GPU cluster in Paris. Such moves position Nebius to capture demand from AI-native startups and enterprises seeking flexible, high-performance compute without long-term lock-ins.

However, contracted power, while securing long-term scalability, often requires substantial upfront capital expenditure (CapEx). Nebius reported $511 million in Q2 2025 CapEx alone, funding these ramps. If connected power lags behind contracted commitments—due to delays in grid connections or permitting—the company risks idle capacity, eroding margins in a market where energy costs are rising. Data from Blocks and Files indicates that AI-driven GPUs consume vastly more electricity than traditional servers, amplifying the need for efficient power provisioning to avoid bottlenecks.

From an industry perspective, this dynamic mirrors broader trends in data centre growth. Hyperscalers like AWS and Azure are expanding AI offerings, but Nebius’s focus on dedicated GPU clusters differentiates it, appealing to niche demands. Analyst models from AInvest project that securing over 1 GW by 2026 could drive revenue multiples, assuming utilisation rates remain above 90%. Yet, execution risks persist: supply chain disruptions could push timelines, as noted in Reddit community discussions on r/stocks, where sentiment labels Nebius as a high-potential but “priced to perfection” play.

Key Risks and Opportunities

• Acceleration Potential: Immediate activation via connected power could enable Nebius to outpace competitors in deploying next-gen GPUs like Nvidia’s H200, as seen in planned 5 MW clusters in Kansas City.
• Funding Dynamics: Recent $1 billion convertible notes issuance supports expansions, but dilution risks loom if conversions occur amid volatile markets.
• Competitive Pressures: Rising energy costs and intensifying competition may compress margins, though Nebius’s neocloud model offers a buffer through optimised billing.
• Geopolitical Factors: Expansions in the U.S. and Europe mitigate reliance on volatile regions, but trade tensions could inflate GPU costs.

Forward-Looking Analysis

Looking ahead, analyst consensus from sources like Yahoo Finance rates Nebius as a “Strong Buy” with a 1.2 score, driven by its positioning in the exploding AI infrastructure market. Model-based forecasts suggest that if Nebius converts 80% of its 2026 contracted power to connected status, annual revenues could exceed $5 billion by 2027, propelled by AI cloud demand. However, this hinges on flawless execution—any slippage in GPU installations could temper growth, especially with the stock’s 102.50% surge over the past 200 days signalling high expectations.

In essence, the distinction between connected and contracted power isn’t mere jargon; it’s a litmus test for Nebius’s ability to transform ambitious guidance into market dominance. Investors eyeing the AI boom would do well to monitor these metrics closely, as they could dictate whether Nebius surges ahead or stumbles in the power-hungry world of data centres. With shares trading near 52-week highs, the margin for error is slim, but the rewards for getting it right are immense.

References

• AInvest. (2025, August 25). Nebius Group 2025 Q2 earnings call: Unpacking key contradictions, revenue guidance, capacity expansion. https://www.ainvest.com/news/nebius-group-2025-q2-earnings-call-unpacking-key-contradictions-revenue-guidance-capacity-expansion-2508/
• AInvest. (2025, August 25). Nebius Group scaling AI infrastructure dominance, margin gains, strategic expansion. https://www.ainvest.com/news/nebius-group-scaling-ai-infrastructure-dominance-margin-gains-strategic-expansion-2508/
• AInvest. (2025, June 25). Nebius Group betting big on AI infrastructure growth: Execution risks. https://www.ainvest.com/news/nebius-group-betting-big-ai-infrastructure-growth-execution-risks-2506/
• Binje. (2025). Nebius accelerates U.S. expansion with new build-to-suit data center in Vineland, adding up to 300 MW capacity. https://binje.com/nebius-accelerates-u-s-expansion-with-new-build-to-suit-data-center-in-vineland-adding-up-to-300-mw-capacity/
• Blocks and Files. (2025, July 14). Power consumption and data centers. https://blocksandfiles.com/2025/07/14/power-consumption-and-data-centers
• Data Center Dynamics. (2025). Nebius to deploy 5MW Nvidia H200 cluster at Patmos data center in Kansas City, Missouri. https://www.datacenterdynamics.com/en/news/nebius-to-deploy-5mw-nvidia-h200-cluster-at-patmos-data-center-in-kansas-city-missouri/
• Group.Nebius.com. (2025). Nebius to triple capacity at Finland data center to 75 MW. https://group.nebius.com/newsroom/nebius-to-triple-capacity-at-finland-data-center-to-75-mw
• Group.Nebius.com. (2025). Nebius accelerates U.S. expansion, adding up to 300 MW capacity at new data center in New Jersey. https://group.nebius.com/newsroom/nebius-accelerates-us-expansion-adding-up-to-300-mw-capacity-at-new-data-center-in-new-jersey
• Reddit. (2025). Nebius (NBIS) has long-term potential but may be priced to perfection. https://www.reddit.com/r/stocks/comments/1irz32e/nebius_nbis_has_longterm_potential_but_may_be/
• Yahoo Finance. (2025). Nebius accelerates U.S. expansion, adding 300 MW. https://finance.yahoo.com/news/nebius-accelerates-us-expansion-adding-124400364.html
• X.com. (2025). @OpeBee post on Nebius infrastructure. https://x.com/OpeBee/status/1822300440962220186
• X.com. (2025). @SoicFinance market view on AI cloud growth. https://x.com/soicfinance/status/1861301111564706225
• X.com. (2025). @StarkNakedBrief commentary on Nebius financials. https://x.com/StarkNakedBrief/status/1932502583043584361
• X.com. (2025). @OpeBee insight on power provisioning. https://x.com/OpeBee/status/1748404365919191470
• X.com. (2025). @HabuSadeik take on GPU supply challenges. https://x.com/HabuSadeik/status/1775511203684479072