Meta signed a $27 billion five-year contract with Nebius for AI compute infrastructure, announced Tuesday. The deal follows a $17 billion Microsoft commitment disclosed in November, bringing Nebius's public contract backlog to $44 billion in under 120 days.
Nebius, the AI infrastructure entity spun from Yandex Cloud in mid-2023, operates data centers across Finland, France, and the Netherlands with capacity expansion underway in the Nordics. The Meta arrangement covers GPU cluster deployment, edge networking, and inference throughput guarantees for Llama training runs and multimodal workloads. Meta will take dedicated rack space in Nebius's Mäntsälä facility north of Helsinki and co-locate custom silicon alongside H100 and H200 arrays. First capacity goes live in Q2 2025, with full buildout by Q4 2026. Pricing sits in the $0.80–$1.10 per GPU-hour range for reserved inventory, materially below AWS and Azure spot rates for comparable Hopper throughput.
This is structural, not tactical. Meta already operates internal compute at exascale, but frontier pre-training and synthetic data pipelines now exceed internal provisioning lead times. Nebius offers reservation certainty without the 18-month lag that plagues hyperscaler capacity requests. For Meta, the trade is margin for speed: outsourcing portions of Llama 4 pre-training to third-party infrastructure in exchange for contractual SLAs and burst headroom when internal clusters saturate. The $27 billion commitment implies Meta expects 25–30 exaflops of incremental demand through 2030, well beyond current disclosed spend. That demand doesn't come from incremental users; it comes from post-ChatGPT model scale assumptions and agentic inference overhead.
For allocators, Nebius just moved from "Yandex spinoff with interesting margins" to "AWS-tier infrastructure counterparty for the two largest AI capital budgets on Earth." The $44 billion backlog dwarfs Nebius's trailing $680 million in annual revenue and implies 20–25% CAGR through 2029 if contract renewals hold. The company trades at NBIS under $38 as of Tuesday close, up 47% intraday, with a market cap still south of $12 billion—less than 3 months of contracted revenue. The float remains thin, institutional ownership under 18%, and liquidity constraints mean this isn't a core position for most funds yet. That changes if Amazon or ByteDance shows up as customer three.
Watch for Nebius's next earnings call in late April, when management will detail CapEx plans and margin guidance under the new contracts. Microsoft's tranche payments begin in Q2; Meta's first milestone lands in Q3. If Nebius maintains 30%+ gross margins on reserved compute—plausible given cheap Nordic power and pre-negotiated Nvidia volume pricing—EBITDA inflects sharply by year-end. Also track permitting timelines for the rumored Iceland facility, which would add 500 megawatts of capacity by 2027 and position Nebius to bid on OpenAI's next infrastructure RFP.
The prior comparables for this moment are Equinix in 2011 and Coreweave 18 months ago. Both required venture-style position sizing and tolerance for illiquidity. Both returned 4–7x to early institutional holders within 36 months.