Nebius Group N.V.

Company Overview

Business Model: Nebius Group N.V. is a global technology company focused on building full-stack AI cloud infrastructure. Its core value proposition is to power AI innovation by providing dedicated, high-performance infrastructure, including an AI cloud platform purpose-built for AI innovators, from individual developers to startups and large enterprises. The company offers compute, storage, managed services, and critical software for training, running, and deploying AI models and applications. Revenue is primarily generated through accelerated compute and data storage solutions, with consumption options ranging from on-demand to fully managed infrastructure and "bare metal" deployments. In addition to its core AI infrastructure business, Nebius Group N.V. operates three distinct businesses: Avride (autonomous driving technology), Toloka (AI data labeling), and TripleTen (edtech platform).

Market Position: Nebius Group N.V. positions itself as one of the largest specialized AI cloud providers globally, with a significant presence in Europe and rapid expansion in the United States. The company emphasizes its full-stack approach, encompassing data centers, in-house-designed hardware, and an intelligent software layer, which it believes delivers end-to-end optimization, combining hyperscaler reliability with purpose-built AI infrastructure flexibility and efficiency. Key competitive advantages include its full-stack control, a leading team of AI/ML and cloud engineers, an AI cloud platform built from the ground up for AI developers, a comprehensive suite of AI services, architecture optimized for large-scale AI deployments, expertise in designing and operating high-power data centers, in-house hardware design for cost efficiency, longstanding partnerships with critical AI hardware providers (e.g., NVIDIA), and NVIDIA Cloud Partner status. The AI technology market is projected to reach $800 billion by 2030, with the total addressable market for GPU-as-a-Service and AI cloud expected to exceed $260 billion by 2030, growing at a 35% CAGR over the same period.

Recent Strategic Developments:

• Divestment of Russian Assets: In July 2024, Nebius Group N.V. completed the divestment of all its businesses in Russia and related businesses in certain international markets. This transaction represented a strategic shift, as the divested businesses constituted more than 95% of the group’s consolidated revenues, assets, and employees in 2023.
• Strategic Equity Raise: In December 2024, Nebius Group N.V. completed a private placement, raising approximately $700 million in gross proceeds from institutional and strategic investors, including Accel, NVIDIA, and Orbis Investment Management Ltd.
• AI Infrastructure Expansion: The company significantly expanded its data center footprint, commissioning its first U.S.-based co-location site in Kansas City, Missouri, in early 2025 and commencing construction of a build-to-suit facility in Vineland, New Jersey. The New Jersey site is a phased development scalable up to 300 MW, with initial capacity expected in the second half of 2025, dedicated to NVIDIA next-generation Blackwell GPUs.
• Product Launches: In October 2024, Nebius AI Cloud, a proprietary AI cloud platform leveraging NVIDIA accelerated computing, was launched. In November 2024, Nebius AI Studio, an inference-as-a-service platform, was launched, providing access to open-source AI models. The company also introduced TractoAI, a serverless platform for scalable AI and Big Data workloads, in beta during Q4 2024.
• Avride Partnerships: Avride entered into multiyear partnerships with Uber (deploying autonomous vehicles and delivery robots in Austin, Dallas, and Jersey City) and Grubhub (sidewalk robots at Ohio State University). In February 2025, Avride partnered with Rakuten in Japan for restaurant and grocery deliveries. In March 2025, Avride formed a strategic partnership with Hyundai for joint development of an autonomous driving platform and fleet expansion, initially deploying 100 Hyundai Ioniq 5 SUVs.
• Toloka Platform Rebuild: Toloka rebuilt its entire platform in 2024 to serve evolving market needs, expanding generative AI data offerings to include red-teaming for AI agents, evaluation of reasoning models, and scalable training data.

Geographic Footprint: Nebius Group N.V. is headquartered in Amsterdam, The Netherlands, with principal operations in Europe, the United States, and Israel.

• Europe: Owns and operates a greenfield data center in Mäntsälä, Finland. Operates co-location sites in Paris, France, and Keflavik, Iceland. Has R&D hubs in Europe and Israel.
• United States: Commissioned its first co-location site in Kansas City, Missouri, in early 2025. Began construction of a build-to-suit facility in Vineland, New Jersey, scalable up to 300 MW. Has R&D hubs in North America. Avride's main operations are in Austin, Texas. TripleTen primarily serves the U.S. and Latin America markets.
• Other Regions: Avride has R&D hubs in South Korea. Toloka serves a global client base.

Cross-Border Operations:

• International Subsidiaries: Principal operating subsidiaries include Nebius B.V., Nebius Israel Ltd., Avride B.V., Toloka AI B.V., Toloka AI Inc., TripleTen Inc., and EdTech Plus B.V. In February 2025, Avride Holding Inc., a Delaware corporation, became the intermediate holding company for the Avride group.
• Joint Ventures: Historically, the company had a mobility joint venture, MLU B.V., with Uber, which was fully acquired by Nebius Group N.V. in April 2023.
• Licensing Agreements: Not explicitly detailed, but the company leverages NVIDIA's accelerated computing platform, featuring NVIDIA’s GPUs and networking.
• Regulatory Compliance: The company operates across multiple jurisdictions and is subject to evolving regulatory frameworks concerning AI, cybersecurity, data privacy, data protection, information security, and export controls. It monitors regulatory developments, including the AI Act in the European Union and proposed BIS rules in the U.S. regarding Infrastructure-as-a-Service (IaaS) providers.

Financial Performance

Revenue Analysis

Profitability Metrics (2024):

• Gross Margin: 37.5% (Calculated as ($117.5M - $73.4M) / $117.5M)
• Operating Margin: -375.0% (Reflects significant operating losses)
• Net Margin: -335.0% (Reflects significant net losses)

Investment in Growth (2024):

• R&D Expenditure (Product Development): $129.7 million (110.4% of revenue)
• Capital Expenditures: $807.7 million (primarily in GPUs and data center hardware)
• Strategic Investments:
  • $700 million gross proceeds from a private placement of Class A ordinary shares in December 2024.
  • Significant investments in expanding data center footprint in the U.S. and Europe, including a build-to-suit facility in New Jersey and co-location sites.
  • Planned delivery of over 22,000 NVIDIA Blackwell and Blackwell Ultra GPUs starting in 2025.

Currency Impact Analysis:

• Foreign exchange impact on revenue and earnings: Nebius Group N.V. operates internationally and experiences gains and losses from fluctuations in foreign currency exchange rates. Foreign exchange losses were $17.5 million in 2024, compared to $2.8 million in 2023.
• Hedging strategies and effectiveness: Not explicitly detailed, but the company monitors foreign currency exposures to maximize economic effectiveness of its positions.
• Functional currency considerations: The functional currency of the parent company, Nebius Group N.V., is the U.S. dollar. The functional currency of other group businesses is generally the respective local currency (e.g., Euro, Israeli Shekel). The reporting currency was changed from Russian Ruble to U.S. dollar retrospectively in 2024 following the divestment. A 10% fluctuation in the Euro relative to the U.S. dollar as of December 31, 2024, would have resulted in an additional foreign exchange gain/loss of $6.9 million.

Business Segment Analysis

Nebius (Core AI Infrastructure)

Financial Performance:

• Revenue: $68.3 million (+611.5% YoY)
• Operating Margin: Not explicitly stated, but Adjusted EBITDA loss was -$128.5 million in 2024, improving from -$134.1 million in 2023.
• Key Growth Drivers: Rise in new customers, increasing size of engagements per customer, expansion of data center facilities, and growth in the installed base of GPUs.

Product Portfolio:

• Full-stack AI cloud solutions: Supports the entire AI lifecycle, from building and deploying AI models to managing large-scale AI applications.
• Infrastructure Layer: Scalable compute, storage, and networking resources engineered for high-performance AI workloads. Includes GPU and CPU-only instances, NVIDIA InfiniBand-connected GPU clusters, and various storage solutions (block, shared file, object storage).
• AI Cloud Platform: Launched in October 2024, leverages NVIDIA accelerated computing platform (GPUs and networking), offering containerization, orchestration (Kubernetes, SLURM), and serverless computing.
• AI and Machine Learning Services: Tools for data preparation, model training, and model deployment. Includes pre-built AI applications and development tools.
• AI Studio: Inference-as-a-service platform launched in November 2024, offering access to open-source text and multimodal LLMs (e.g., Llama family, Mistral, DeepSeek-R1) via a token-based monetization model. Services include real-time inference, batch inference, fine-tuning, and image generation.
• TractoAI (beta): Serverless platform for scalable AI and Big Data workloads, launched in Q4 2024, offering dynamic resource allocation and pay-as-you-go billing.

Market Dynamics:

• Competitive positioning within segment: Competes with specialized cloud service providers (CoreWeave, Crusoe, Lambda Labs) and general-purpose cloud computing providers (Amazon (AWS), Google (Google Cloud Platform), Microsoft (Azure), Oracle). Differentiates through full-stack control, in-house hardware design, and optimized AI-native cloud platform.
• Key customer types and regional market trends: Primary customers are independent developers and AI-native technology companies. Focused on expanding to frontier AI labs and enterprise customers.
• Regulatory environment by jurisdiction: Subject to evolving regulations on AI, cybersecurity, data privacy, and export controls across multiple jurisdictions.

Geographic Revenue Distribution:

• Primary Markets: Europe and the U.S.
• Growth Markets: Actively exploring additional sites in the U.S. and other geographies to expand capacity.

Avride (Autonomous Driving Technology)

Financial Performance:

• Revenue: $0.3 million (N/A YoY, as 2023 revenue was $0)
• Operating Margin: Not explicitly stated, but Adjusted EBITDA loss was -$67.0 million in 2024, improving from -$69.6 million in 2023.
• Key Growth Drivers: Strategic partnerships and expansion into new geographies and use cases.

Product Portfolio:

• Developer of autonomous driving technology for self-driving vehicles and delivery robots.
• Use cases include ride-hailing, logistics, e-commerce, food, and grocery delivery.

Market Dynamics:

• Competitive positioning within segment: Competes with major developers of self-driving technologies, including Waymo and Zoox.
• Key customer types and regional market trends: Partnerships with companies like Uber, Grubhub, Rakuten, and Hyundai.
• Regulatory environment by jurisdiction: Operates in a highly regulated sector, subject to stringent safety and product liability requirements. Received certification for delivery robots in Japan in December 2024.

Geographic Revenue Distribution:

• Austin, Texas: Main operations.
• Europe, Israel, South Korea: Additional R&D hubs.
• U.S. Deployments: Austin and Dallas, TX (Uber Eats, 2024); Jersey City, NJ (Uber Eats, February 2025); Ohio State University campus (Grubhub).
• International Deployments: Central Tokyo, Japan (Rakuten, February 2025).

Toloka (AI Data Labeling)

Financial Performance:

• Revenue: $26.4 million (+137.8% YoY)
• Operating Margin: Not explicitly stated, but Adjusted EBITDA loss was -$40.1 million in 2024, improving from -$42.1 million in 2023.
• Key Growth Drivers: Growth in demand for data services utilized in the training, evaluation, and development of generative AI models.

Product Portfolio:

• Leading data provider for LLM and generative AI developers.
• Delivers scalable, high-quality data solutions for all stages of AI development (training, fine-tuning, alignment, evaluation).
• Leverages AI and expert-human input for complex, high-quality data at scale.
• Expanded generative AI data offerings in 2024 to include red-teaming for AI agents, evaluation of reasoning models, and scalable training data powered by coding and math experts.

Market Dynamics:

• Competitive positioning within segment: Competes with other GenAI data providers, including Scale AI, Snorkel AI, and Surge AI.
• Key customer types and regional market trends: Serves a global client base, including AI research labs, foundational model developers, Fortune 500 companies, and GenAI startups (e.g., Amazon, Anthropic, Avride, Microsoft, Nebius, Poolside, Recraft, ServiceNow, Shopify).
• Regulatory environment by jurisdiction: Subject to data privacy, data protection, and information security laws across various markets.

Geographic Revenue Distribution:

• Europe: R&D hub.
• U.S.: Offices.
• Global Client Base: Network of domain experts, annotators, and writers spans over 20 knowledge areas and 120 subdomains globally.

TripleTen (Edtech Platform)

Financial Performance:

• Revenue: $28.8 million (+251.2% YoY)
• Operating Margin: Not explicitly stated, but Adjusted EBITDA loss was -$30.8 million in 2024, improving from -$37.0 million in 2023.
• Key Growth Drivers: Growth in the number of new students due to increasing penetration of the core U.S. market and expansion into Latin America.

Product Portfolio:

• Edtech platform focused on reskilling individuals for careers in technology.
• Offers six immersive B2C study tracks: software engineering, quality assurance, BI analytics, data science, cybersecurity, and UX/UI design.
• Provides B2B AI-focused courses for beginners and professionals.
• Operates on a proprietary tech stack and automated platform for scalable course development, localization, and expansion.

Market Dynamics:

• Competitive positioning within segment: Competes with other U.S.-based edtech bootcamp providers. Recognized by Fortune Magazine as the best overall provider of software engineering bootcamps in the U.S. Top-rated on major bootcamp review platforms (SwitchUp and Course Report) with a 4.87/5 rating as of December 2024.
• Key customer types and regional market trends: Served over 14,000 students in 2024. Over 80% of graduates secured a tech job within six months of program completion for the twelve months ending June 2024.

Geographic Revenue Distribution:

• Primary Markets: U.S. and Latin America.

International Operations & Geographic Analysis

Revenue by Geography:

International Business Structure:

• Subsidiaries: Nebius Group N.V. is the holding company. Principal operating subsidiaries include Nebius B.V. (Netherlands), Nebius Israel Ltd. (Israel), Avride B.V. (Netherlands), Toloka AI B.V. (Netherlands), Toloka AI Inc. (U.S.), TripleTen Inc. (U.S.), and EdTech Plus B.V. (Netherlands). In February 2025, Avride Holding Inc., a Delaware corporation, became the intermediate holding company for the Avride group.
• Joint Ventures: No current material joint ventures explicitly detailed post-acquisition of Uber's interest in MLU B.V.
• Licensing Agreements: Not explicitly detailed, but relies on NVIDIA's accelerated computing platform.

Cross-Border Trade:

• Export Markets: Nebius Group N.V. provides AI cloud services globally. Avride deploys autonomous technology in the U.S. and Japan. Toloka serves a global client base.
• Import Dependencies: Highly dependent on a limited number of suppliers, primarily NVIDIA, for GPU chips and other key components in its AI infrastructure.
• Transfer Pricing: Not explicitly detailed, but international tax strategy includes transfer pricing policies and documentation requirements.

Capital Allocation Strategy

Shareholder Returns:

• Share Repurchases: Nebius Group N.V. received 162,485,725 Class A shares as partial consideration for the divestment in 2024, which are held in treasury. The weighted-average cost per Class A share received was $14.1.
• Dividend Payments: Nebius Group N.V. does not have any present plan to pay cash dividends on its shares in the near term.
• Dividend Yield: Not applicable.
• Future Capital Return Commitments: No specific future capital return commitments were disclosed.

Balance Sheet Position (as of December 31, 2024):

• Cash and Equivalents: $2,449.6 million
• Total Debt: $6.1 million (current portion of debt, primarily remaining obligation from convertible notes restructured in 2022)
• Net Cash Position: $2,443.5 million
• Credit Rating: Not disclosed.
• Debt Maturity Profile: The remaining debt obligation of $6.1 million is current.

Cash Flow Generation (2024):

• Operating Cash Flow: -$307.7 million (Net cash used in operating activities from continuing operations)
• Free Cash Flow: -$1,115.4 million (Calculated as Operating Cash Flow - Capital Expenditures: -$307.7M - $807.7M)
• Cash Conversion Metrics: Not explicitly detailed.

Currency Management:

• Cash holdings by major currencies: Primarily U.S. dollars, with exposure to Euro and Israeli Shekel.
• Natural hedging through operational diversification: Not explicitly detailed, but international operations inherently provide some diversification.
• Financial hedging instruments and strategies: Not explicitly detailed, but the company monitors foreign currency exposures.

Operational Excellence

Production & Service Model: Nebius Group N.V. builds full-stack AI cloud infrastructure, designing servers and racks in-house and embedding innovation in data center design to maximize compute performance. This approach provides full control over performance optimization, reliability, and cost efficiency. Its proprietary AI cloud platform is optimized for highly intensive, distributed AI workloads, streamlining AI development and deployment. The company offers flexible GPU allocation, workload bundling, auto-scaling, and resource-efficient inference to minimize idle capacity and lower client costs.

Global Supply Chain Architecture: Key Suppliers & Partners:

• GPU Chips: NVIDIA - primary supplier for GPU chips (e.g., H200s, planned Blackwell and Blackwell Ultra GPUs).
• Other Key Components: Limited number of other suppliers for critical infrastructure components.
• Manufacturing Partners: Leading server original design manufacturers (ODMs).
• Technology Partners: NVIDIA (Reference Platform NVIDIA Cloud Partner status).

Facility Network:

• Manufacturing: In-house server prototyping, production, and deployment.
• Research & Development: R&D hubs across Europe, the U.S., and Israel, with hundreds of engineers specializing in data-center construction, hardware R&D, AI cloud platform development, and AI research.
• Distribution:
  • Greenfield Data Centers: Owns and operates a data center in Mäntsälä, Finland, designed for optimal power and hardware efficiency, featuring free-cooling and heat recovery systems.
  • Build-to-Suit Facilities: Developing a facility in Vineland, New Jersey, with a developer building to custom specifications for energy efficiency and infrastructure optimization.
  • Co-location Sites: Leases capacity at existing data centers in Paris, France; Keflavik, Iceland; and Kansas City, Missouri, deploying in-house-designed racks for optimized power consumption.

Operational Metrics:

• GPU Capacity: Approximately 30,000 GPUs deployed as of March 31, 2025, primarily NVIDIA H200s.
• Data Center Capacity: Approximately 45MW of connected capacity across Europe and the U.S. as of March 31, 2025. New Jersey facility scalable up to 300 MW.
• Efficiency Measures: Finland data center features one of the world’s leading power usage effectiveness (PUE) levels under high IT loads, recovering 15,000-20,000 MWh of server heat annually. In-house designed servers consume approximately 20% less power than equivalent third-party hardware. Proprietary toolless rack design simplifies maintenance and reduces staffing requirements.

Market Access & Customer Relationships

Go-to-Market Strategy: Distribution Channels:

• Direct Sales: Expanding direct sales teams across the U.S. and Europe, supported by growing pre-sales and post-sales teams, including dedicated system architects and technical/engineering support.
• Channel Partners: Expanding network of strategic channel partners, including Independent Software Vendors (ISVs) focused on AI/ML, Value-Added Resellers (VARs), and System Integrators (SIs).
• Digital Platforms: Self-service offering for independent developers and researchers to access the AI cloud platform on demand.

Customer Portfolio: Enterprise Customers:

• Tier 1 Clients: Not explicitly detailed, but the company aims to meet the needs of frontier AI labs and large technology companies.
• Strategic Partnerships: Avride has partnerships with Uber, Grubhub, Rakuten, and Hyundai. Toloka serves Amazon, Anthropic, Avride, Microsoft, Nebius, Poolside, Recraft, ServiceNow, and Shopify.
• Customer Concentration: In 2024, Customer A accounted for 21% of total revenue, and Customer B accounted for 17%. In 2023, Customer B accounted for 13% and Customer C for 31%. In 2022, Customer B accounted for 20% and Customer C for 54%.

Regional Market Penetration:

• United States: Majority of the customer base is currently concentrated in the U.S.
• Growth Markets: Actively expanding offerings to serve enterprise clients globally and exploring additional sites in the U.S. and other geographies.

Competitive Intelligence

Global Market Structure & Dynamics

Industry Characteristics: The AI technology market is projected to reach $800 billion by 2030, growing at a 29% CAGR from 2023 to 2030. The total addressable market for GPU-as-a-Service and AI cloud is estimated to exceed $260 billion by 2030, with a 35% CAGR. The market is intensely competitive, rapidly evolving, and characterized by continuous technological advancements, changing customer requirements, and the frequent introduction of new solutions. Demand for high-performance computing (HPC) for large-scale foundation models and generative AI applications is rapidly increasing.

Competitive Positioning Matrix:

Direct Competitors

Primary Competitors (Core AI Infrastructure):

• Specialist AI Infrastructure Providers: CoreWeave, Crusoe, Lambda Labs.
• General-Purpose Cloud Computing Providers: Amazon (AWS), Google (Google Cloud Platform), Microsoft (Azure), Oracle (developing AI-specific offerings).

Regional Competitive Dynamics:

• AI Infrastructure: National governments (e.g., U.S.) are launching initiatives to sponsor AI infrastructure development, potentially intensifying competition.
• Avride: Competes with major developers of self-driving technologies, including Waymo and Zoox.
• Toloka: Competes with other GenAI data providers, including Scale AI, Snorkel AI, and Surge AI.
• TripleTen: Primarily competes with U.S.-based edtech bootcamp providers.

Risk Assessment Framework

Strategic & Market Risks

Global Market Dynamics:

• Early Stage & Capital Intensive: Businesses are at an early stage, capital-intensive, and operate in new, rapidly changing markets. Success depends on scaling these businesses, which is uncertain.
• Intense Competition: Faces significant and evolving competition from specialized AI cloud providers and general-purpose cloud computing giants. Inability to adapt to new technologies or customer requirements could negatively affect financial condition.
• Technological Developments: Rapid pace of AI technology development, including AI models requiring less computation power, may decrease or alter demand for offerings.
• Market Opportunity Estimates: Estimates of market opportunity and growth forecasts may be inaccurate, leading to failure in meeting growth targets.
• Geopolitical and Macroeconomic Developments: Increases in protectionist measures, restrictions on foreign companies, and business practices favoring local competition could negatively affect businesses. Weak global/regional economic conditions could reduce customer spending.
• Customer Demand: Risk of insufficient customer demand to utilize built compute capacity, impacting returns on expansion efforts.
• Pricing Pressures: Evolving industry and increasing competition may lead to pricing pressures, reducing margins.

Operational & Execution Risks

Global Supply Chain Vulnerabilities:

• Supplier Dependency: Dependent on a limited number of suppliers (e.g., NVIDIA for GPUs). Supply chain disruptions, delays, or increased costs could adversely affect growth plans.
• Regional Disruptions: Data centers are subject to operational risks, including cybersecurity, physical security, and third-party dependencies (power, network connectivity).
• Data Center Expansion: Future growth relies on significant expansion of data center footprint. Difficulties in site identification, construction, or obtaining reliable power on acceptable terms will limit growth.
• Talent Acquisition & Retention: Substantial competition for highly skilled development and technical personnel in technology and AI industries. Inability to hire and retain qualified employees could materially impact businesses.
• Avride Third-Party Investment: Actively seeking third-party investment into Avride, including transactions that may lead to loss of control. Failure to secure investment may limit growth or lead to divestment/wind-down.
• Environmental Standards: Failure to maintain best practices relating to environmental standards during data center expansion may lead to reputational and legal risks.
• Strategic Partnerships: Potential failure of strategic partnerships to realize anticipated benefits.

Financial & Regulatory Risks

Currency & Financial Risks:

• Capital Intensive & Unprofitable: Businesses are capital-intensive and currently not profitable. Ability to grow depends on raising additional equity or debt financing, which may not be available on acceptable terms.
• Fluctuating Results: Operating results may fluctuate on a quarterly and annual basis, particularly given the early stage of businesses and markets.
• Currency Exchange Rates: Exposed to fluctuations in currency exchange rates (primarily Euro, Israeli Shekel vs. USD), which could negatively affect results of operations.
• Asset Valuation: Inability to accurately estimate the value and useful lives of long-term infrastructure assets (e.g., GPUs) could adversely affect results.
• Tax Laws: Changes in tax laws, regulations, or unpredictable application of existing rules in countries of operation may adversely affect financial results.
• Material Weaknesses in Internal Control: Identified material weaknesses in internal control over financial reporting, particularly related to new IT infrastructure, revenue recognition, and fixed assets reconciliation. Remediation is ongoing and expected by Q4 2025. Failure to remediate could impact financial reporting accuracy and investor confidence.

Regulatory & Compliance Risks:

• Evolving AI Regulations: Development and use of AI tools and data centers are subject to intense political scrutiny and evolving, complex, and potentially divergent regulatory frameworks across multiple jurisdictions (e.g., EU AI Act, BIS rules in U.S.). Non-compliance could lead to litigation, penalties, or business model limitations.
• Data Privacy & Security: Subject to stringent and complex laws and regulations related to data privacy, data protection, and information security across different markets. Failure to comply could adversely affect competitive position and reputation.
• Export Controls: Strengthening export controls in many jurisdictions will likely impact supply chains and operations, particularly regarding semiconductor industry equipment.

Geopolitical & External Risks

Country-Specific Risks:

• Legacy from Russia Divestment: Although no longer operating in Russia, the company's legacy could create challenges, including protracted client onboarding and "know-your-customer" processes.
• Geopolitical Conflicts: Global macroeconomic and geopolitical uncertainty (e.g., conflicts, political tensions, inflation, interest rate volatility) could impact business.

Innovation & Technology Leadership

Research & Development Focus: Global R&D Network:

• R&D Centers: R&D hubs across Europe, the U.S., and Israel.
• Focus Areas: Data-center construction and operations, hardware engineering and R&D, AI cloud platform development, and AI research and development.
• Innovation Pipeline: Building a full stack of purpose-built, tuned, and optimized hardware and software to accelerate AI ambitions. Continuously innovating across every layer of infrastructure to optimize resource allocation.

Intellectual Property Portfolio:

• Patent Strategy: Not explicitly detailed, but relies on copyright, trademark, patent, trade secret laws, confidentiality procedures, and contractual commitments to protect IP.
• Licensing Programs: Not explicitly detailed.
• IP Litigation: Risk of becoming involved in intellectual property infringement claims due to the large number of patents in the cloud infrastructure and technology industries.

Technology Partnerships:

• Strategic Alliances: Long-standing partnerships with leading chipmakers (e.g., NVIDIA) and OEMs.
• Research Collaborations: Nebius Academy provides cloud grants to students and academic partners, and offers advanced online and in-person programs in data science, machine learning, and generative AI.

Leadership & Governance

Executive Leadership Team

International Management Structure:

• The executive leadership team includes individuals with international experience and expertise.
• Regional leadership and reporting relationships are not explicitly detailed but implied by global operations.

Board Composition:

• Independence: The Board includes a majority of independent directors. The audit, compensation, and nominating and corporate governance committees consist solely of independent directors.
• International Expertise: Board members have diverse backgrounds, including experience in technology, finance, and academia across various international markets (e.g., U.S., Israel, Netherlands).
• Regulatory Compliance: Nebius Group N.V. is a "Controlled Company" under Nasdaq rules due to the concentration of voting power with its founding shareholder (Arkady Volozh's family trust holds ~55% of voting power). It relies on Nasdaq rules permitting compliance with Dutch corporate governance practices, which differ from U.S. domestic issuer practices in areas like quorum requirements and proxy statements. The audit committee consists of Messrs. Ryan (chairperson), Boynton, and Rijnja, with Mr. Ryan qualifying as an "audit committee financial expert."

Regulatory Environment & Compliance

Multi-Jurisdictional Regulatory Framework: Primary Regulatory Environments:

• The Netherlands: Incorporated in the Netherlands, subject to Dutch corporate law and the Dutch Corporate Governance Code (DCGC). Taxable profits are subject to a 25.8% income tax rate.
• United States: Subject to U.S. federal securities laws and reporting requirements (e.g., Sarbanes-Oxley Act, SEC, Nasdaq listing standards). Subject to various economic and trade sanctions.
• European Union/EEA: Subject to regulations like the AI Act and data privacy laws (e.g., GDPR).
• Japan: Avride obtained certification for its delivery robots in Japan in December 2024.

Cross-Border Compliance:

• Export Controls: Monitoring regulatory developments concerning export controls in the semiconductor industry and their impact on sourcing equipment. BIS proposed rules may impose requirements on IaaS providers regarding foreign person customers.
• Sanctions Compliance: Implemented procedures and safeguards to facilitate compliance with economic sanctions and export control laws.
• Anti-Corruption: Not explicitly detailed, but general compliance with applicable laws and regulations is stated.
• Data Privacy & Protection: Subject to stringent and complex laws and regulations related to data privacy, data protection, and information security across different markets, which are constantly evolving.

International Tax Strategy:

• Transfer Pricing: Not explicitly detailed, but transfer pricing policies and documentation requirements are part of international tax planning.
• Tax Treaties: U.S. holders may be subject to Dutch dividend withholding tax, with potential relief under the 1992 Double Taxation Treaty between the U.S. and the Netherlands for qualifying entities.
• BEPS Compliance: Not explicitly detailed.
• Contingent Tax Liability: Accrued a contingent tax liability of $180.9 million as of December 31, 2024, for Dutch dividend withholding tax related to Class A shares received as consideration for the divestment, which was subsequently settled in February 2025.

Environmental & Social Impact

Global Sustainability Strategy: Nebius Group N.V. is committed to sustainability and Environmental, Social, and Governance (ESG) principles, overseen by the Board’s Nominating and Corporate Governance Committee and coordinated by a group sustainability manager. The strategy focuses on sustainable computing, empowerment through technology, and reliability and security.

Environmental Commitments:

• Climate Strategy: Investing heavily in energy efficiency across the technology stack (data centers, hardware, product features) to reduce environmental footprint.
• Carbon Neutrality: Not explicitly stated, but aims to make progress towards reducing global carbon footprint and ensuring business viability in a low-carbon economy.
• Renewable Energy: Not explicitly stated, but plans to pursue opportunities to improve energy and water efficiency.
• Data Center Design: Finland data center features innovative free cooling and heat recovery systems, achieving energy overheads at least half the industry averages and recovering server heat to warm local homes. In-house hardware designs are for thermal efficiency.

Regional Sustainability Initiatives:

• Supply Chain: Global supplier ESG requirements and sustainability standards are not explicitly detailed but implied by overall sustainability commitments.

Social Impact by Region:

• Community Investment: Through Nebius Academy, provides cloud grants to students and academic partners, and offers advanced online/in-person programs in data science, machine learning, and generative AI.
• Labor Standards: HR approach built on fairness, transparency, and compliance with local labor regulations across global locations. Offers competitive compensation, professional growth opportunities, flexible working arrangements, and mental health support services. Committed to hiring local talent, with a workforce from over 50 nationalities. Women represented approximately one-third of the leadership team in 2024.

Currency Management & Financial Strategy

Multi-Currency Operations: Currency Exposure (as of December 31, 2024):

Hedging Strategies:

• Transaction Hedging: Not explicitly detailed, but the company monitors foreign currency exposures.
• Translation Hedging: Not explicitly detailed. Translation gains and losses are recorded as foreign currency translation adjustments in other comprehensive income/(loss).
• Economic Hedging: Not explicitly detailed.
• Overall: The company's exposure to foreign currency exchange risk significantly decreased in 2024 following the divestment of its Russian and Russia-related businesses. The functional currency of the parent company is the U.S. dollar, and the reporting currency was changed to the U.S. dollar retrospectively. A 10% fluctuation in the Euro relative to the U.S. dollar as of December 31, 2024, would have resulted in an additional foreign exchange gain/loss before tax of $6.9 million.