Shares of Nebius Group NV (NBIS) tumbled 5.09% in early trading on Thursday, as investors digested the company's third-quarter earnings report and a cautionary analysis of its recent stock rally. The significant drop comes amid a broader reassessment of the company's valuation and future prospects.

Nebius Group reported an improvement in its adjusted EBITDA loss for Q3 and the nine months ended September 2025. The company's core Nebius segment achieved positive adjusted EBITDA in the second quarter and continued to improve in the third quarter. However, these improvements seem to have fallen short of market expectations, given the stock's sharp decline.

Adding to the downward pressure, a recent analysis based on the Adhishthana Principles suggests that Nebius Group's stock rally since April might not be sustainable. The analysis points out that the company is currently in Phase 17 of its 18-phase Adhishthana Cycle, which is typically considered a "no-trade phase." The stock's transition into Phase 18 in December 2025 is expected to bring sluggish or range-bound trading, given its poor performance during critical earlier phases.

The pre-market activity already hinted at this downturn, with Nebius Group showing a 1.1% decline before the market opened. This drop has now accelerated into a more significant plunge as regular trading began. Investors appear to be reassessing the stock's valuation in light of the earnings report and the cautionary outlook, leading to the current sell-off.