About a third of Q3 revenue was non-recurring

Start with the quarter itself, because the headline growth rate needs its footnote attached. Nebius reported third-quarter revenue of $980.8 million, up 571% year over year and ahead of the $907.5 million LSEG consensus reported by CNBC. Adjusted EBITDA reached $465.8 million, net loss from continuing operations was $37.5 million, and operating income turned positive for the first time at $50.4 million.

The shareholder letter also states that about $325 million of that revenue was non-recurring, recognized under a new asset-light partnership model. Excluding it leaves about $655.8 million of reported revenue — a subtraction, not a recurring-revenue measure. Still fast growth, and still ahead of the revenue consensus, but not the same business the 571% figure suggests. The company is also moving away from annualized recurring revenue as its guidance basis: the $7–9 billion December ARR target is now expected to be exceeded for the month of February 2027, and from 2027 Nebius will guide on revenue and pre-tax earnings.

The 2027 number, and who is meant to fund it

The spending plan is the larger story. Capital expenditure for 2026 is now put at about $27 billion, up from a $20–25 billion range. For 2027, Nebius guided to $40–45 billion, against a FactSet consensus of about $28.77 billion, alongside preliminary revenue guidance of $12–13 billion and a target of pre-tax breakeven by the end of 2027.

How it intends to pay is stated plainly in the letter. Prepayments from customers, plus asset-backed financing raised against existing contracts with investment-grade customers, are expected to cover 75–85% of the 2027 bill. Committed prepayments are put at about $10 billion in 2026, rising to $17–20 billion in 2027, and prepayments on deals signed in the third quarter covered more than 100% of the capital spending behind them. The company held $7.4 billion in cash at the end of September, and the letter says it has a wide range of other funding options available.

That structure leans on three things holding: customers keep paying early, sites open on time so the contracts behind the loans keep their value, and lenders keep accepting those contracts on similar terms.

The site that tests those conditions

The weak point is already visible. Capacity at third-party sites has slipped into the first half of 2027, which is why 2026 revenue guidance fell to the low end of its range. The clearest case is Vineland, New Jersey, where a third-party operator, DataOne, runs capacity contracted to Microsoft under a deal TechCrunch values at up to $19.4 billion. Nebius's letter says it expects to have delivered more than half of the capacity contracted with Microsoft by the end of the year, with the remaining tranches now scheduled for the second quarter of 2027.

The letter itself gives the mechanism: in late Q3, DataOne started to retire some of the site's temporary generation ahead of the move to permanent power, and that decision reset the schedule for the remaining tranches. The permanent source is Bloom Energy fuel cells, which the letter says are already online and scaling. TechCrunch reported the temporary generation was wound down faster than expected, at a site where New Jersey regulators had already fined the operator $1.1 million over unpermitted gas generators. TechCrunch also reports that Nebius's SEC-filed summary of the Microsoft contract allows Microsoft to terminate affected service after a grace period if dates are missed without alternative capacity, and includes penalties for late delivery. Nebius says Microsoft has been part of the planning process. It also says the delays sit at sites it does not control, while sites it builds itself are on time or ahead, and the letter says most new capacity will come from its own data centers. CEO Arkady Volozh put it directly on the earnings call, as TechCrunch reported: "Building at this scale is hard, and delays are part of our industry right now. We are not immune."

What to watch

Three checks will say more than the guidance does. Compare cash collected with committed prepayments as subsequent disclosures become available, starting with the December quarter results expected early next year. The Vineland tranches due in the second quarter of 2027 are the first hard test of the new timetable with Microsoft. And any change to the 75–85% funding expectation in the next shareholder letter would warrant a fresh look at the financing assumptions and delivery schedules behind the plan.

The shares fell about 17% on November 12, according to TechCrunch. The spending increase and the capacity delays give investors reasons to scrutinize the financing plan, but the closing move does not isolate their effects.

Sources

  1. [1] Nebius Group, "Nebius reports third quarter 2026 financial results," results release (SEC Form 6-K, Exhibit 99.1, November 12, 2026)Read source
  2. [2] Nebius Group, "Letter to shareholders Q3 2026" (SEC Form 6-K, Exhibit 99.2, November 12, 2026; guidance, funding structure, New Jersey delay and ARR shift)Read source
  3. [3] Nebius Group, Q3 2026 interim financial statements (SEC Form 6-K, Exhibit 99.1, November 12, 2026; segment revenue and adjusted EBITDA detail)Read source
  4. [4] TechCrunch, "Nebius tests the neocloud playbook with $40 billion in planned spending," November 12, 2026 (Microsoft deal value, regulatory fine, contract-summary terms, earnings-call quote, share move)Read source
  5. [5] Reuters, "Nebius pares back 2026 revenue forecast on capacity delays, shares slump," November 12, 2026
  6. [6] CNBC and FactSet consensus figures as reported November 12, 2026 (LSEG revenue consensus $907.5 million; FactSet 2027 capex consensus $28.77 billion)