On March 11, Nvidia announced that it would invest $2 billion in Nebius Group (NBIS 4.04%), a neocloud company that offers dedicated artificial intelligence (AI) data centers and software solutions to companies looking to run AI workloads in the cloud.
Nebius stock has jumped by 57% since that investment was revealed. However, the good news for investors is that it isn't too late to buy shares of this fast-growing cloud infrastructure provider, which is witnessing remarkable growth in revenue and has a massive backlog that could ensure years of healthy growth.
In fact, don't be surprised if Nebius becomes a multibagger from here.
Image source: The Motley Fool.
Nebius is targeting the next wave of AI applications
Nebius' dedicated AI data centers are being used by hyperscalers including Meta Platforms and Microsoft. Lucrative long-term deals with these tech giants have pushed Nebius' revenue backlog to a whopping $46 billion.
NASDAQ: NBIS
Key Data Points
Not surprisingly, the company is focused on adding more cloud computing capacity. Nebius recently announced that it will construct a 310-megawatt (MW) AI factory in Finland. Management added that it aims to end 2026 with 3 gigawatts (GW) of contracted power, which will enable it to significantly enhance its operational data center capacity in the long run.
Nebius' active data center power capacity stood at 170 MW at the end of 2025. Its huge contracted power capacity should enable it to substantially increase the active capacity and convert its massive backlog into revenue.
Even better, Nebius has set its sights on making the most of the next phase of AI growth. The company has partnered with Nvidia to build dedicated data centers to accelerate the development of physical AI applications. Nvidia's high-end platforms will provide these data centers with their computing power, and the semiconductor giant will also provide software solutions so customers can easily run physical AI solutions on Nebius' infrastructure.
This end-to-end approach to deploying cloud infrastructure for physical AI and agentic AI should help future-proof Nebius' business. That's because, according to a study from Research and Markets, the physical AI market could grow from $383 billion this year to a whopping $3.25 trillion in 2040. Meanwhile, a different research study from Fortune Business Insights forecasts that from 2025 to 2034, the agentic AI market could jumpby about 1,800% to over $139 billion.
So, Nebius is pulling the right strings to ensure that its revenue grows substantially from the $530 million it brought in last year.
The stock has multibagger potential
Analysts view Nebius as being poised to deliver exponential long-term growth.
NBIS Revenue Estimates for Current Fiscal Year data by YCharts.
What's worth noting is that the combined revenue Nebius is expected to deliver over the next three years is still less than its massive backlog. So, there is a strong possibility that the company's growth will accelerate beyond 2028, especially as it adds more data center capacity.
If Nebius indeed achieves $16 billion in revenue in 2028 and trades at 9 times sales at that time, in line with the U.S. tech sector's average sales multiple, its market cap would jump to $144 billion. That's more than triple its current market cap, suggesting that this AI stock could indeed deliver additional multibagger gains.
