Nebius bets $40 billion on the neocloud playbook, financed by customer prepayments

Nebius used its third-quarter earnings call on Thursday to lay out roughly $40 billion in planned spending for 2027, far more than Wall Street had expected, as it races to keep building AI data center capacity.

The more pressing question is how that buildout gets paid for. Nebius intends to lean on customer prepayments and loans backed by customer contracts — in effect, financing data centers with their own future value. Chief financial officer Maria Del Dado Alonso Sanchez said prepayments plus asset-backed financing of investment-grade contracts should cover up to 85% of a 2027 capital budget of $40 billion to $45 billion. The company ended the quarter with $7.4 billion in cash.

That structure buckles if projects slip or get cancelled: costs keep accruing while revenue arrives later. “Building at this scale is hard, and delays are part of our industry right now,” CEO Arkady Volozh said on the call. “We are not immune.”

The cracks are already visible. Microsoft is one of Nebius's largest customers, paying for capacity at a Vineland, New Jersey site that is months behind schedule under a contract worth up to $19.4 billion. Only just over half of that Microsoft capacity is now slated for delivery by the end of the year, with the rest pushed to the second quarter of 2027. According to Nebius, the third-party operator DataOne wound down temporary generation faster than expected while the site switches to Bloom Energy fuel cells.

That transition was not entirely voluntary. The investigative outlet Floodlight documented at least 45 natural gas generators running at the site without permits for gas generation, and New Jersey regulators fined DataOne $1.1 million for violating federal law. The facility also faces a noise complaint lawsuit from nearby residents.

Microsoft, meanwhile, is tightening its posture. Bloomberg reported last week that it is cooling on neocloud deals that miss deadlines and stepping up oversight of third-party projects run by Nebius, IREN and Nscale. Under the contract summary Nebius has published, Microsoft can terminate affected service after a grace period if dates are missed and no alternative capacity is offered, and the agreement carries financial penalties for late delivery. Nebius says Microsoft “has been part of the planning process” but has not said whether it agreed to the new dates.

The numbers were mixed. Third-quarter revenue reached $981 million, up 571% year over year, though roughly a third of that came from a one-time payment tied to a new partnership model. Nebius cut its 2026 revenue forecast by $200 million to $3 billion, citing delays at third-party sites, and the stock closed down 17%.

Nebius still forecasts 2027 revenue of $12 billion to $13 billion and pre-tax break-even by the fourth quarter. Its argument is that the slippage sits at sites it does not control, while the data centers it builds itself are on time or ahead of schedule and will supply most of its new capacity from 2027. The next two quarters of delivery data will decide whether that holds.