The AI Stock That's Secretly Crushing Nvidia

3 weeks ago 19

Manali Pradhan, CFA, The Motley Fool

Tue, December 2, 2025 astatine 10:20 AM CST 3 min read

Nebius delivered higher stock terms returns compared to Nvidia successful the past year.
Megadeals with Microsoft and Meta Platforms improved Nebius’ gross visibility arsenic good arsenic credibility arsenic a starring unreality player.
With disposable capableness already sold and caller capableness presold, Nebius is simply a large beneficiary of the demand-supply mismatch successful the information halfway space.
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For the past fewer years, Nvidia (NASDAQ: NVDA) has been the favourite artificial quality (AI) banal connected Wall Street. But portion investors enactment hyper-focused connected Nvidia's grounds net numbers and maturation prospects amid GPU shortages, different AI banal managed to present acold higher returns. This banal is besides positioned to surpass Nvidia's returns successful the coming year.

Professional smiling portion taking notes connected paper, and sitting infront of desktop show with banal marketplace charts.

Nebius (NASDAQ: NBIS) rents AI-optimized information halfway compute capacity, comprising dense GPU clusters, liquid cooling technology, and an enterprise-grade bundle stack, to ample hyperscalers and enterprises for moving high-intensity AI grooming and inferencing workloads. Share prices of the institution are up implicit 355% successful the past twelvemonth (as of Dec. 1), acold higher than Nvidia's comparable stock terms gains of conscionable implicit 30%.

While Nebius' concern is decidedly much volatile than Nvidia owed to Nebius' precocious superior expenditure requirements and dense reliance connected GPU availability, the banal besides has important upside potential. Here's why.

Demand for AI-optimized unreality computing capableness is higher than the disposable supply. Hence, Nebius has not lone sold disconnected each disposable capacity, but besides pre-sold caller capableness successful caller markets specified arsenic Israel and the United Kingdom adjacent earlier its launch. The pricing powerfulness is evident successful the company's coagulated financials, with third-quarter gross increasing 355% twelvemonth implicit twelvemonth and halfway AI infrastructure revenues jumping 400%.

The institution has entered a multiyear GPU capableness proviso woody worthy $17.4 cardinal with Microsoft, which tin beryllium expanded to $19.4 billion, arsenic good arsenic a five-year AI infrastructure woody with Meta Platforms worthy $3 billion. These megacontracts person validated the company's presumption arsenic a salient AI unreality supplier and besides dramatically improved its gross visibility.

Nebius has hiked its capex guidance from $2 cardinal to $5 cardinal successful 2025. The institution plans to adhd 800 megawatts to 1 gigawatt of connected powerfulness and 2.5 gigawatts of contracted powerfulness by the extremity of 2026. Hence, the institution volition proceed to capitalize connected the increasing request for capableness successful the coming years.