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Nebius' AI Infrastructure Rally Is Back—And the Numbers Explain Why
Author: Ryan Hasson. Article Published: 2/20/2026.
Key Points
- Nebius shares have gained more than 20% over the prior week as accelerating demand and raised contracted power guidance boosted investor confidence.
- Management reaffirmed its ambitious $7 to $9 billion ARR target for 2026, highlighting strong pricing power and long-term customer commitments.
- With analysts lifting price targets and the stock reclaiming $100, NBIS is approaching a key resistance level that could trigger a fresh breakout.
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Nebius Group (NASDAQ: NBIS) has quickly emerged as one of the market's standout performers in AI infrastructure. Over the past week, shares have surged more than 21%, fueled by confident forward guidance, a wave of bullish analyst upgrades and BlackRock's large stake in the company.
Just two weeks ago, the stock was testing a major support level and appeared to be losing momentum. Following its latest earnings report, Nebius is now pressing against key resistance and flirting with a potential breakout.
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With improving fundamentals and strengthening technicals, the company is increasingly positioning itself as a potential leader in the AI infrastructure space.
Shares Climb After Q4 Results
Nebius reported fourth-quarter 2025 results on Feb. 12. At first glance, the numbers looked mixed.
Revenue was $227.7 million, below estimates of $246 million, though it still represented 547% year-over-year growth and 55% sequential growth. Gross margin held at 70%, compared with 71% in the prior quarter. Adjusted EBITDA was $15 million versus expectations of $40.4 million, while adjusted EBITDA margin for the core business improved to 24% from 19% in Q3. EPS was negative $0.69, below consensus of negative $0.42.
The headline revenue miss initially raised eyebrows, but context matters. Management explained that most of the new capacity came online in late November, so it meaningfully contributed only to December revenue. As a result, quarterly revenue lagged expectations while forward indicators painted a stronger picture.
Active power reached 170 MW, well above the previously guided 100 MW. Year-end annual recurring revenue climbed to $1.25 billion, up 127% quarter over quarter. More importantly, management reiterated its ambitious year-end 2026 ARR target of $7 billion to $9 billion, signaling continued confidence in demand.
Revenue guidance for 2026 was set at $3 billion to $3.4 billion, which management called a prudent approach. The company also reiterated its year-end 2026 connected power target of 800 MW to 1 GW and raised its contracted power guidance from more than 2.5 GW to over 3 GW.
AI Demand Accelerating, Not Slowing
During the earnings call, management emphasized that demand trends remain robust.
Enterprise and AI-native customers continue to outpace available supply, allowing Nebius to sell future capacity well in advance. In Q4 the company saw nearly twice as many transactions for contracts longer than 12 months compared with Q3, and average selling prices increased by more than 50%.
Management also said the company has effectively sold out of Hoppers, with renewal contracts extending 12 months or longer at improved pricing. That combination of longer-term commitments and rising prices suggests strengthening pricing power rather than softening demand.
Analysts Turn More Bullish
On Feb. 18, Compass Point initiated coverage with a Buy rating and a $150 price target, implying roughly 54% upside at the time of the report. A day earlier, BWS Financial reiterated its Buy rating with a $130 price target, noting meaningful upside potential.
Those notes add to an already improving analyst backdrop. Both firms viewed the Q4 "misses" as timing-related rather than demand-related, with power and ARR targets driving the 2026 thesis.
If the company continues converting contracted power into connected power on schedule, the upside case becomes easier for analysts to support. Nebius now has 11 analyst ratings, a consensus Moderate Buy, and an average price target of $143.33 — a level that still implies substantial upside despite the stock's roughly 140% gain over the past year.
Impressive Relative Strength and Breakout Potential
While many software and AI-related names have struggled recently, Nebius has bucked the trend. Shares are up roughly 28% year to date and recently reclaimed the $100 level.
If the stock can continue to hold above $100 and build support, the next key level to watch is the $110 resistance zone. A sustained move above that area could trigger a breakout and mark the start of another leg higher within its broader uptrend.
Overall, the combination of accelerating demand, improving unit economics and growing analyst conviction makes Nebius a name to watch in the AI infrastructure trade. Execution on its power-conversion and ARR targets will determine whether the company can sustain this next phase of growth.
The Late-Stage Bull Market Is a Buying Opportunity for Tech
Authored by Jordan Chussler. Publication Date: 2/22/2026.
After years of leading the pack, the tech sector has been in retreat since the NASDAQ hit its all-time high last October. While the ongoing sell-off has fueled speculation that the market is in the late stages of its bull run, for discerning investors this presents a potential buying opportunity in names that haven't been on sale for a while.
Tech stocks finished 2025 with a nearly 34% gain, but after Monday's loss of 1.68% the cohort is down 2.15% year-to-date (YTD), making it the second-worst performer among the S&P 500's 11 sectors.
Much of the weakness can be attributed to the underperformance of several of the Magnificent Seven, which has prompted an exodus to defensive sectors and equal-weight exchange-traded funds (ETFs). Ongoing fears about an AI bubble and a widespread sell-off in software stocks have also weighed on the sector.
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Rumblings of a potential bear market could mean more downside for tech. But even if that materializes, valuations are improving and analysts are increasingly arguing that the growth-focused sector is starting to offer value.
A Late-Stage Bull Market Doesn't Mark Its End
As Andrew Slimmon, head of the applied equity advisors team at Morgan Stanley (NYSE: MS), pointed out in the firm's 2026 market outlook report, a late-stage bull market is not synonymous with the end of a bull cycle.
Slimmon acknowledged the cycle is mature but not finished, noting the average bull market lasts five to seven years and that "history favors the bull market in a fourth year," which is where the market sits in 2026.
Those years have historically delivered positive returns. Slimmon added that "investors who take higher risk may be rewarded in the coming year, and while corrections are likely in a potentially volatile year for stocks, that could be healthy and support the broader trend upward."
The NASDAQ is undergoing a pullback, down more than 5% from its October high, and some individual tech names are already in correction territory, including a few Magnificent Seven members.
Both Amazon (NASDAQ: AMZN) and Meta Platforms (NASDAQ: META) are down more than 19% from their respective one-year highs. Palantir (NASDAQ: PLTR) is nearly 37% below its one-year high.
AI-powered customer relationship management provider HubSpot (NYSE: HUBS) has fallen more than 43% YTD, and International Business Machines (NYSE: IBM) dropped more than 13% on Feb. 23 alone.
That does not automatically make these stocks buys. However, the market's flight to safety has disproportionately benefited sectors like energy, materials, and industrials, leaving numerous tech stocks oversold.
Evidence of a Buying Opportunity
Both technical and fundamental indicators support the idea of a buying opportunity. The NASDAQ's current Relative Strength Index (RSI) reading of 41.40 is trending toward 30, the threshold for oversold territory. The index is still trading below its 50-day moving average, as shown in the chart below, suggesting more downward price action could occur before the NASDAQ finds support at its 200-day moving average and potentially reverses.
Key Points
- Despite the NASDAQ falling 5% from its October high and tech currently lagging the S&P 500, analysts argue this is late-stage bull market maturity rather than the end of the cycle.
- Several major names—including Adobe, Intuit, and The Trade Desk—are trading at Relative Strength Index levels well below 30. Combined with significant year-to-date losses, these stocks are oversold.
- Improving valuations, including Meta’s forward P/E of 24.13 and Adobe’s 14.78, indicate that earnings potential is becoming cheaper.
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MarketBeat has identified dozens of oversold tech stocks, some with RSI readings well below 30 and notable analyst price targets:
- Adobe (NASDAQ: ADBE): RSI 25.09, down 25.99% YTD, 59.22% potential upside over the next 12 months
- Paychex (NASDAQ: PAYX): RSI 24.16, down 19.53% YTD, 41.82% potential upside over the next 12 months
- Accenture (NYSE: ACN): RSI 23.88, down 22.61% YTD, 48.66% potential upside over the next 12 months
- The Trade Desk (NASDAQ: TTD): RSI 22.85, down 38.58% YTD, 140.50% potential upside over the next 12 months
- Workday (NASDAQ: WDAY): RSI 20.84, down 37.21% YTD, 88.07% potential upside over the next 12 months
- Intuit (NASDAQ: INTU): RSI 17.64, down 42.88% YTD, 104.87% potential upside over the next 12 months
- Automatic Data Processing (NASDAQ: ADP): RSI 16.53, down 18.65% YTD, 40.96% potential upside over the next 12 months
Fundamentally, several of these companies are showing improving metrics. For example, Meta's trailing 12-month (TTM) price-to-earnings (P/E) ratio of 27.37 was elevated, but its forward P/E of 24.13 implies more earnings per dollar invested going forward.
Meta's year-over-year (YOY) earnings-per-share (EPS) growth also illustrates the point. After surging more than 73% YOY in 2023 and nearly 61% YOY in 2024, its EPS growth dropped to -1.55% last year, suggesting some potential for regression toward the mean this year.
That trend is visible outside the Magnificent Seven as well. Adobe's forward P/E is 14.78, Paychex's is 17.72, and Accenture's is 15.77. Their five-year annual average EPS growth rates are 10.01%, 9.01%, and 9.20%, respectively.
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