Nebius Prepayments Now Cover More Than 100% of Capex as Q3 Revenue Hits $980.8M

Nebius Group reported third-quarter 2026 revenue of $980.8 million, up 571% year over year, and said customers have committed more than $12 billion in contract value since the start of Q3. The company disclosed the figures on November 12, 2026, in a shareholder letter that also revealed a striking shift in deal economics: prepayments on agreements signed during the quarter now cover more than 100% of the capital expenditure tied to those contracts, including data center construction and networking. That figure stood at 50%–60% in Q2.

The improvement matters because of the scale of the build-out behind it. Nebius purchased approximately $7.3 billion of property, equipment and intangible assets during the quarter, primarily GPUs, related hardware and data center expansion. When customer cash arrives before the hardware is paid for, the financing problem that dominates AI infrastructure economics becomes materially smaller.

How Strong Were the Underlying Numbers?

The headline growth rate carries a significant qualification. About $325 million of the $980.8 million quarterly total was non-recurring revenue from the initial phase of an asset-light rollout, under which partners fund capacity using Nebius's architecture and AI Cloud platform. The core Nebius AI Cloud business accounted for approximately 99% of group revenue, and the company attributed growth to both new capacity and this partner-funded model, making the one-off contribution central to interpreting the 571% figure.

Profitability metrics moved in the right direction. Adjusted EBITDA (a company-defined non-GAAP measure excluding depreciation, interest, share-based compensation and other items) reached $465.8 million. The GAAP net loss from continuing operations narrowed to $37.5 million.

Contract economics also improved on a payback basis. For comparable one-to-three-year contracts, expected payback shortened to one year and seven months, down from one year and ten months in the prior period. Nebius measured that figure on a revenue basis across operating and capital costs, excluding any benefit from prepayments.

What Went Wrong at the Colocation Sites?

Delivery dates at several third-party colocation sites moved into the first half of 2027, including the remaining New Jersey tranches tied to Nebius's contract with Microsoft. The delays pushed some expected revenue out of 2026 and into 2027.

The New Jersey situation now breaks down as follows:

• Nebius expects to have delivered more than half of the Microsoft-contracted New Jersey capacity by the end of 2026.
• The remainder is scheduled for Q2 2027.
• The contracts behind the delayed capacity remain in place, and affected customers have been informed.

The site's power infrastructure drove much of the slippage. In late Q3, DataOne started retiring some temporary generation ahead of the move to permanent power, resetting the schedule for the remaining tranches. Bloom Energy fuel cells are already online, and Nebius is scaling that generation to serve as the site's main power source. Microsoft has participated in the planning process. Nebius said its owned sites remain on time or ahead of schedule — a distinction that reinforces the company's stated strategy of shifting investment toward facilities it controls.

How Did the Guidance Change?

Two numbers moved in opposite directions. Nebius now expects 2026 revenue at the low end of its $3.0–$3.4 billion range, because some expected third-party capacity will not arrive until 2027. At the same time, the 2026 capital-expenditure forecast increased to approximately $27 billion, up from the prior range of $20–$25 billion, as the company invests in 2027 capacity, particularly at owned sites.

The initial 2027 outlook is more ambitious on both spending and profitability:

• Pre-tax breakeven is targeted for Q4 2027.
• Capital expenditure of $40–$45 billion is planned for the year.
• That spending will fund more than one gigawatt of new capacity.
• Management expects customer prepayments and available investment-grade asset-backed financing to fund 75%–85% of the outlay.

The financing structure is the operative detail. Investment-grade asset-backed financing, paired with the now-larger prepayment stream, would cover most of a spending program larger than the company's entire historical capital base. The remaining 15%–25% represents the equity and cash burden Nebius must carry itself.

What Does This Mean for the AI Infrastructure Market?

The quarter separates demand from delivery. Customers accepted longer, higher-priced contracts with more cash upfront — the prepayment coverage above 100% and the $12 billion in committed contract value since the start of Q3 are the proof. Yet colocation delays shifted recognized revenue outward anyway, forcing the company to guide to the low end of its own range.

That divergence carries a lesson for the broader market. AI cloud providers can lock in demand at improving terms and still miss near-term revenue targets if third-party data centers, power generation or grid interconnections slip. Nebius's answer is visible in its capital allocation: raising 2026 spending toward owned sites while colocation partners reset their schedules.

The 2027 targets now rest on execution. Nebius must convert the commitments into operating capacity on the revised schedules — including the Q2 2027 New Jersey deliveries to Microsoft — while arranging the remaining 15%–25% of financing for its expansion. Pre-tax breakeven in Q4 2027 depends on both happening roughly in parallel.