Neocloud firm Nebius maps $40 billion spending plan amid supply delays

OPA WIRE, Nov 12 (OPA) — Neocloud provider Nebius announced $40 billion in planned spending for 2027 on Thursday, exceeding Wall Street expectations. The financing model depends on customer pre-payments and loans backed by customer contracts to fund data center construction. However, the strategy faces risks from ongoing project delays and cancellations across the sector.

Chief Executive Officer Arkady Volozh acknowledged the operational hurdles during the earnings call. Building at scale remains difficult, and supply bottlenecks impact industry timelines. Nebius reported third-quarter revenue of $981 million, marking a 571% increase from the previous year. Approximately one-third of that revenue stemmed from a one-time payment tied to a new partnership model. Shares dropped 17% following the announcement.

A primary friction point involves a massive AI computing capacity contract with Microsoft for a data center in Vineland, New Jersey. The project is months behind schedule due to regulatory setbacks and operational shifts involving third-party operators. New Jersey regulators fined the DataOne facility $1.1 million in August after discovering unauthorized natural gas generators in operation. The site is currently transitioning to Bloom Energy fuel cells.

Nebius reduced its 2026 revenue forecast by $200 million to $3 billion because of delays at third-party sites. Despite these setbacks, the company projects 2027 revenue between $12 billion and $13 billion. Executives anticipate breaking even on a pre-tax basis by the fourth quarter of 2027, relying on prepayments to cover up to 85% of capital expenditures.