Nebius Group N.V. (NBIS), which rents out computing power built on Nvidia Corp. (NVDA) chips, just borrowed $3.5 billion from Citigroup.
The facility matures in 364 days, according to an Oct. 22 press release. A one-year term makes it a bridge to longer-term financing, not the financing itself.
The timing says more than the dollar figure. A day earlier, Nebius revenue chief Marc Boroditsky told CNBC that AI computing prices are rising faster than expected. He said a capacity auction on Oct. 20 showed prices still climbing.
He also set Nebius apart from CoreWeave Inc. (CRWV), where the cost of insuring debt against default hit distress levels, CNBC reported. “We’re not carrying the kind of debt that they are,” Boroditsky said.
Together, the moves show a company sure about demand but unwilling to lock in long-term debt at today’s prices.
“Sequencing our financing is how we optimize our long-term cost of capital,” said Chief Operating Officer Ophir Nave.
Also read: Nebius stock breaks below $200 as CoreWeave’s debt scare spreads
A one-year Citi loan buys Nebius time
The loan charges Term SOFR, a benchmark tracking U.S. short-term rates, plus 2.75 percentage points, the release said. That margin can rise to 3.5 points. Because the base rate floats, any Federal Reserve hike would lift Nebius’s interest bill.
Last week, I wrote that cheap money had become the scarcest input for GPU landlords. As I noted then, Nebius’s first secured loan, in July, cost 2.5 points over SOFR. The Citi deal starts a quarter point higher, a modest premium rather than a distress signal.
Alongside customer prepayments and operating cash flow, the money will fund data centers and GPUs, the release says. It stacks on roughly $10 billion of convertible bonds already outstanding, Reuters reported.
A bridge is only as safe as its exit. Nave said Nebius can tap asset-backed financing tied to more than $40 billion of contracts with investment-grade customers. Boroditsky added that Nebius’s 2027 capacity would sell out if brought online, CNBC reported.
Rental rates still determine how much profit that demand throws off. Nebius has just put those rates on public display.
Nebius put its GPU prices where lenders can see them
Nebius began publishing live spot prices for its GPU capacity on Oct. 21, the company said. Spot capacity is computing time that Nebius can interrupt. The prices also appear on outside platforms such as Silicon Data.
Investors are debating how fast Nvidia’s chips lose economic value, CNBC noted. Nebius just handed that depreciation debate a live scoreboard.
Nvidia Vice President Nico Caprez called its hardware “productive, durable, and fungible” in Nebius’ announcement. “Durable” is the word that is disputed.
Crusoe CEO Chase Lochmiller offered a counterpoint. “We’re seeing higher pricing today for A100s than we saw in 2020 or 2021,” he told CNBC about the older Nvidia chips. Strong rents on aging chips are how neoclouds earn back their GPU spending.
A live price feed cuts both ways. If rates slip, Citi and every shareholder will see it live. I’d watch that page more closely than any executive interview.
Nebius is also piloting rebates for customers who release idle GPUs back into its spot pool. That pilot quietly admits that some reserved capacity sits unused, even though Boroditsky told CNBC that demand still outruns supply.
The customers paying those prices are in production
Nebius’ customer list points to everyday workloads rather than hoarding. Netherlands-based Prosus said Nebius’ inference service doubled throughput for its e-commerce businesses.
Neobank bunq’s assistant, Finn, matches leading closed models at 60% of the cost per answer on Nebius, the company said. Cheaper answers tend to invite more questions, so falling unit costs can still grow total compute spending.
Its European capacity now spans six countries, from Finland to Iceland, the company also said. It is adding $10 million in compute grants to draw the region’s builders. Both need more data centers, and the Citi loan funds the next stage of that global build-out.
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Wall Street is betting the bridge holds
The stock has not rewarded either move. Shares rose Oct. 21 after SpaceX (SPCX) reported a ninefold jump in AI revenue, CNBC reported. They closed almost flat, then fell nearly 4% in premarket trading the following day.
Analysts are more patient. The 22 analysts tracked by StockAnalysis rate Nebius a Buy on average, with a price target of $283.60. That target sits about 65% above the latest close, a bet that signed contracts outweigh today’s debt jitters.
Once GPU rents trade in the open, lenders can price the chips behind every neocloud loan. In that market, the cheapest borrower may win the buildout race, not the fastest builder.
The price Nebius pays to refinance this bridge will tell every rival what lenders now believe.
