Nebius accelerates US expansion, adding up to 300 MW capacity at new data center in New Jersey

Rhea-AI Summary

Nebius Group (NASDAQ: NBIS) announced a significant expansion of its US cloud computing capacity with plans to construct a new data center in New Jersey with up to 300 MW capacity. The build-to-suit facility's first phase is expected to complete by summer 2025, supporting their target of 100 MW installed capacity by end-2025.

The company also revealed capacity additions at other locations:

• Additional deployment phase in Kansas City, expected online by Q2 2025
• New colocation deployment in Keflavik, Iceland, powered by geothermal energy, to be operational by Q1 2025
• Tripled capacity at their Finland data center

These expansions will boost Nebius's total secured expansion capacity to over 400 MW, strengthening their position as a global AI infrastructure provider in both US and European markets.

Positive

• Major capacity expansion with 300 MW New Jersey facility
• Total secured expansion capacity exceeds 400 MW
• Multiple new data centers coming online by 2025
• Eco-friendly geothermal power source for Iceland facility

Negative

• Significant capital expenditure required for multiple facility expansions
• Extended timeline to full capacity deployment (through 2025)

Insights

Data Center Infrastructure Analyst

Nebius Group's expansion announcement represents a significant scaling of its AI infrastructure, with the New Jersey facility adding up to 300 MW of potential capacity. This move substantially accelerates their previously communicated target of 100 MW of installed capacity by end-2025. The phased development approach provides strategic flexibility to match deployment with actual demand growth.

The expansion across multiple geographies (New Jersey, Kansas City, Iceland, and Finland) creates a diversified infrastructure footprint that enhances service reliability and reduces latency for customers across different regions. Particularly notable is the company's emphasis on the US market, signaling a strategic pivot toward capturing market share in the world's largest cloud computing market.

By securing expansion capacity exceeding 400 MW with more in the pipeline, Nebius is positioning itself to capitalize on the surging demand for AI compute resources. The build-to-suit approach in New Jersey gives them control over facility design, likely optimizing power efficiency and cooling systems - critical factors in controlling operational costs and maximizing computational density per square foot.

The Iceland deployment leverages geothermal energy, addressing growing customer preferences for environmentally sustainable compute resources. This multi-region strategy enables Nebius to offer distributed computing options that align with both performance and regulatory requirements.

Financial Analyst

Nebius's accelerated infrastructure expansion represents a substantial capital commitment that signals confidence in future demand growth. While specific investment figures aren't disclosed, data centers of this scale typically require $5-15 million per MW in development costs, potentially representing a $1.5+ billion long-term investment for the New Jersey facility alone at full capacity.

The phased deployment approach balances growth ambitions with capital efficiency, allowing for calibrated investment timing based on customer acquisition. By securing sites with expansion potential, Nebius gains valuable optionality to scale rapidly if market conditions warrant, while maintaining discipline on utilization rates.

This expansion significantly increases Nebius's total addressable market, particularly in the high-demand US region. The decision to build their own facility rather than solely using colocation services suggests a long-term commitment to the region and expectations of sustained demand that justifies the fixed-cost investment.

The CEO's statement about growing to "multiples of where we are today" indicates a substantial revenue growth trajectory. Given typical data center economics, this expanded capacity could translate to significant recurring revenue growth as utilization increases, though with a lag between capital deployment and revenue realization as capacity is gradually filled.

• New build-to-suit facility in New Jersey will have design capacity of up to 300 MW;
• Incremental capacity also being added at existing facility in Kansas City and new site in Iceland.

AMSTERDAM--(BUSINESS WIRE)-- Nebius Group N.V. (“Nebius Group” or the “Company”; NASDAQ: NBIS), a leading AI infrastructure company, today announced a major upgrade to its US-based cloud computing capacity with the planned construction of a new data center in New Jersey with capacity of up to 300 MW.

The data center that Nebius has commissioned in New Jersey will be built to Nebius’s own design, enabling the company to achieve maximum efficiency and offer superlative performance to customers. The facility is a phased development expandable up to a total capacity of 300 MW, with the first capacity expected to be completed as early as summer 2025. This delivers on the company’s previous guidance for 100 MW of installed capacity by the end of 2025, with potential to accelerate beyond that if required to meet demand.

Arkady Volozh, founder and CEO of Nebius, said:

“Our first major data center in the US clearly advances our strategic goal of expanding our footprint in the American market as we continue building Nebius into a leading global AI infrastructure provider. This site has the potential to host dedicated large-scale instances, and we have considerable flexibility to accelerate our deployment plans as and when we need to.

“With New Jersey, we now have secured expansion capacity to over 400 MW. And we are actively reviewing options to extend this pipeline further as we seek to grow aggressively to multiples of where we are today.”

In addition to the new data center in New Jersey, Nebius today announced incremental capacity additions at its existing colocation deployment in Kansas City and a new location in Iceland.

In Kansas City, Nebius has agreed a second deployment phase, with the additional capacity expected to be online by the end of Q2 2025. Delivery of the first phase at Kansas City remains on track for Q1 2025. In Iceland, Nebius confirmed a new colocation deployment in Keflavik, Iceland, as it builds out more AI infrastructure in Europe. Physical deployment and software installation are underway, and the new capacity is expected to be fully operational and available to clients by the end of Q1 2025. This deployment is powered by Iceland's abundant geothermal energy to reduce environmental impact.

Combined with the tripling of capacity at Nebius’s first data center in Finland, as well as potential deployments at new sites currently in the pipeline, these additions will make a significant contribution to the company’s planned ramp-up of installed capacity in the US and Europe during 2025.

About Nebius

Nebius (NASDAQ:NBIS) is a technology company building full-stack infrastructure to service the explosive growth of the global AI industry, including large-scale GPU clusters, cloud platforms, and tools and services for developers. Headquartered in Amsterdam and listed on Nasdaq, the company has a global footprint with R&D hubs across Europe, North America and Israel.

Nebius’ core business is an AI-centric cloud platform built for intensive AI workloads. With proprietary cloud software architecture and hardware designed in-house (including servers, racks and data center design), Nebius gives AI builders the compute, storage, managed services and tools they need to build, tune and run their models.

A Preferred cloud service provider in the NVIDIA Partner Network, Nebius offers high-end infrastructure optimized for AI training and inference. The company boasts a team of around 400 skilled engineers, delivering a true hyperscale cloud experience tailored for AI builders. To learn more please visit www.nebius.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250305405030/en/

Media Relations: media@nebius.com

Source: Nebius Group

FAQ

What is the capacity of Nebius's new New Jersey data center and when will it be operational?

The New Jersey data center will have a total capacity of up to 300 MW, with the first phase expected to be operational by summer 2025.

How much total expansion capacity has NBIS secured with these new developments?

Nebius has secured expansion capacity of over 400 MW across their various locations.

When will Nebius's Kansas City facility's second phase be completed?

The additional capacity at Kansas City is expected to be online by the end of Q2 2025.

What are the environmental features of NBIS's new Iceland data center?

The Iceland facility in Keflavik will be powered by geothermal energy to reduce environmental impact and will be operational by Q1 2025.

What is Nebius's (NBIS) installed capacity target for the end of 2025?

Nebius aims to achieve 100 MW of installed capacity by the end of 2025.