Nebius Group NV (Derivatives) (NBIS)

$NBIS is down 10% following reports that $META is developing a cloud business to sell access to excess AI compute.

This was something that had been expected for a long time.

Meta has been pushing CapEx as aggressively as possible because any potential excess capacity could always be resold later anyway. Mark Zuckerberg said as much back in May.

It doesn’t change anything for $NBIS IMO.

Quick reminder: Nebius has a $12B contract with Meta, plus a $15B backstop. And according to Nebius’ management, they don’t expect to use a single dollar of that backstop for Meta. Instead, that capacity should be sold to enterprise customers at higher margins, because the demand is clearly there.