Nebius says “well-funded” for AI race after closing $4.3 billion debt raise

By Toby Sterling

AMSTERDAM, March 22 (Reuters) – Nebius closed a $4.34 billion convertible debt funding round on Monday, with a company executive saying that the European AI infrastructure firm is now “well-funded” ​to meet its 2026 capital spending plans of $16 billion to ‌20 billion.

The financing caps a month in which Nebius sold $2 billion of share warrants to Nvidia and sealed a deal worth up to $27 billion to supply Facebook-owner Meta with data center capacity, underscoring investor appetite for AI infrastructure.

Chief Communications ‌Officer ​Tom Blackwell said the company will keep expanding ⁠and may strike additional ⁠deals like the Meta contract, which followed a $17.3 billion supply deal with Microsoft in September.

“We’ll continue to consider these types of deals as we go, just because if they’re structured in the ​right way, they can be a very efficient source of capital,” he said.

STRATEGIC FOCUS ON AI CLOUD

Blackwell said the big contract ⁠wins were not only a validation of ⁠its expertise, but also a way to fund a ​business that will sustain it in years beyond the current AI ​demand frenzy – offering AI cloud services to firms on top ‌of the physical infrastructure it provides.

He rejected the idea that Nebius is expanding too quickly and will be left vulnerable in a downturn. “As long as enterprise AI adoption does continue to increase… the need ⁠for what we’re doing is going to make sense,” he said.

Nebius plans to fund 60% of growth from customer prepayments – largely Microsoft and Meta – and ⁠40% through a ‌mix of equity and debt, Blackwell said.

On March ⁠10, the firm sold $2 billion in share warrants to ​Nvidia at ‌a share price of $94.94. Monday’s convertible bond offering ​was increased ⁠amid strong demand, Blackwell said.

It featured a rate of 2.63% for notes due in 2033, with conversion at roughly 90% above the company’s closing stock price Friday of $117.62.

“We’ve managed to achieve a significant amount of funding while really minimizing the dilution,” he said.

(Reporting by Toby Sterling; Editing ​by Arun Koyyur)