[Management View]
Nebius reported a nearly 400% YoY revenue increase in Q1 2025, with a strong focus on expanding AI infrastructure and launching new products. Strategic partnerships, particularly with NVIDIA, and a robust cash position of $1.44 billion underpin their growth strategy.

[Outlook]
The company reiterated its full-year revenue guidance of $500 million to $700 million, with an ARR target of $750 million to $1 billion by year-end. Nebius aims for mid-single-digit billions in revenue in the midterm, with EBIT margins of 20%-30%.

[Financial Performance]
Q1 2025 saw a 400% YoY revenue increase, surpassing expectations. The company plans a $2 billion CapEx for 2025, up from $1.5 billion, to support infrastructure expansion.

[Q&A Highlights]
1. Question: What do you mean by midterm revenue and margins?
Answer: Midterm refers to the next few years, targeting several billion dollars in revenue. Growth will be driven by expanding data center capacity and capturing enterprise-level customers.

2. Question: What drove Q1 ARR strength, and how do you feel about the full year?
Answer: Strong demand for GPUs and scalable infrastructure drove ARR. The company expects continued robust demand, with April's ARR at $310 million, supporting full-year guidance.

3. Question: When will you achieve positive adjusted EBITDA?
Answer: Positive adjusted EBITDA is expected in the second half of 2025, with the core infrastructure business reaching this milestone in Q3.

4. Question: Why was CapEx guidance raised?
Answer: CapEx was increased to $2 billion due to opportunistic expansion, including a new data center in Israel, to meet growing demand.

5. Question: How will future growth be financed?
Answer: Growth will be financed through cash reserves and monetization of non-core assets, minimizing shareholder dilution and maintaining low debt levels.

6. Question: What are the future growth sectors?
Answer: Growth will come from AI-native startups, enterprise clients, and national AI projects, with a focus on expanding data center capacity globally.

7. Question: How does Toloka deconsolidation impact your business?
Answer: Toloka will be deconsolidated due to a loss of voting control, with updated financials provided in Q2 2025.

8. Question: Can you update on capacity expansion plans?
Answer: New data centers in New Jersey, Kansas City, Iceland, and Finland are on track, with over 100 megawatts of capacity expected in 2025.

9. Question: What is the impact of tariffs on expansion plans?
Answer: Current tariffs are not expected to significantly impact costs or expansion plans, but the situation is being monitored.

10. Question: Why do customers choose Nebius?
Answer: Customers value Nebius for its high-performance, scalable infrastructure and deep expertise, driving significant returns on AI investments.

11. Question: What is the status of the NVIDIA partnership?
Answer: The partnership is strong, with Nebius being a launch partner for NVIDIA's Blackwell Ultra AI Factory and part of the NVIDIA Cloud Partner program.

12. Question: How does the software stack drive revenue and margins?
Answer: The software stack enhances customer stickiness and enables higher-margin services, contributing to overall revenue growth.

[Sentiment Analysis]
Analysts and management maintained a positive tone, focusing on growth opportunities and strategic partnerships. Management expressed confidence in achieving financial targets.

[Quarterly Comparison]
| Metric | Q1 2025 | Q1 2024 |
|-------------------------|---------------|---------------|
| Revenue Growth | +400% | N/A |
| Cash Balance | $1.44 billion | N/A |
| CapEx | $544 million | N/A |

[Risks and Concerns]
Potential risks include tariff volatility and the need for significant capital investment to support growth. The deconsolidation of Toloka may impact financial reporting.

[Final Takeaway]
Nebius is aggressively expanding its AI infrastructure and product offerings, supported by strategic partnerships and a strong financial position. The company is well-positioned to capture growth in emerging AI markets, with a focus on scalability and customer-centric solutions. Despite challenges, Nebius remains confident in achieving its ambitious revenue and profitability targets in the coming years.