Nebius Group (NBIS), an artificial intelligence cloud service provider, announced on Thursday a significant increase in quarterly capital expenditures, primarily driven by purchases of AI chips and expanded investments in data centers. The AI cloud company is accelerating its computing capacity expansion to meet soaring demand.

The Amsterdam-based firm, whose clients include tech giants Microsoft (MSFT) and Meta Platforms (META), stated it will continue to broaden its data center footprint by adding nine new campuses in the United States, France, Israel, and the United Kingdom.

The company's stock, which surged more than 200% last year, experienced volatile trading in early sessions and was recently down 3%.

Nebius is one of the industry's leading emerging cloud service providers, offering hardware and cloud computing power to other technology companies. Its core business involves supplying NVIDIA (NVDA) chips and AI cloud infrastructure.

Similar to larger competitor CoreWeave (CRWV), Nebius has benefited in recent years from sustained corporate investment in artificial intelligence.

In a letter to shareholders, Nebius CEO Arkady Volozh stated, "Demand from enterprise and AI-native customers continues to outpace supply, allowing us to pre-sell future computing capacity... We are fully committing resources to further expand our capabilities through organic growth and targeted acquisitions by 2026."

In the fourth quarter of last year, the company's capital expenditures surged to approximately $2.1 billion, compared to just $416 million during the same period a year earlier.

These investments have helped Nebius secure over 2 gigawatts (GW) of contracted power, significantly exceeding expectations. The company now anticipates it will possess more than 3 GW of contracted power by the end of 2026, up from a previous forecast of over 2.5 GW.

According to data from London Stock Exchange Group (LSEG), Nebius's fourth-quarter revenue skyrocketed over sixfold to $227.7 million, though it still fell short of market expectations of $246.1 million. The net loss widened to $249.6 million from $133.2 million in the same quarter the previous year.

The company forecasts that its annualized revenue will reach $7 billion to $9 billion by the end of 2026, compared to $1.25 billion expected by the end of 2025.