Nvidia Drops Nearly $4 Billion on Nebius, Doubling Down on AI Cloud Infrastructure

Nvidia (NVDA) disclosed in a July 21 SEC filing that it has boosted its stake in Dutch AI cloud provider Nebius (NBIS) to 9.3%. Shares of Nebius surged as much as 17% intraday on the news.^[CNBC] Nvidia closed at $212.06 on July 22, up 2.30% (+$4.77) from the prior close of $207.29. The stock hit an intraday high of $214.39 and a low of $204.95. U.S. markets were closed on July 23 for a holiday, so the current quote reflects the July 22 close with no real-time changes.

From 1.1 Million Shares to 9.3%: Nvidia’s Big Bet

According to the SEC filing cited by Motley Fool, Nvidia previously held just 1.1 million Nebius shares. The latest move added over 21 million shares, bringing its total to roughly 22.2 million shares, or 9.3% of Nebius’s outstanding stock.^{[Motley Fool]} The total investment exceeds $3.8 billion, making Nebius a 12% slice of Nvidia’s portfolio.

Notably, the new shares weren’t bought on the open market. They came from warrants Nvidia obtained in the first quarter. The filing also reveals that Nvidia is barred from selling these newly acquired shares until September 11, 2026.^{[Motley Fool]} That lock-up clause means Nvidia will be a long-term strategic shareholder at least through mid-September.

Nvidia had already announced a $2 billion investment in Nebius back in March as part of a broader partnership covering AI infrastructure deployment, cluster management, inference, and AI factory design.^{[CNBC (AMP)]}

The Neocloud Race: GPU-as-a-Service Takes Off

Nebius operates in the “neocloud” space—a new breed of cloud provider that stockpiles GPUs and other high-performance computing infrastructure, offering compute power to AI companies on a GPU-as-a-service model.^{[Motley Fool]}

Nebius’s financials reflect the market’s explosive growth. In Q1 2026, the company posted revenue of $399 million, up 684% year-over-year. Its core AI services are running at an annualized revenue run rate of $1.92 billion, up 674% from a year ago.^{[Motley Fool]} The company is not yet profitable.

According to Synergy Research Group, the neocloud market is projected to grow from $25 billion in 2025 to $400 billion by 2031, a compound annual growth rate of 58%. The report notes that “neocloud providers are capturing a larger share of the fastest-growing segment of the cloud market, fundamentally reshaping the competitive landscape for AI infrastructure.”^{[Motley Fool]}

Jensen Huang’s Endorsement and Wall Street Follows

Nvidia CEO Jensen Huang’s admiration for Nebius is no secret. At last month’s Computex trade show in Taipei, Huang named Nebius one of the few “world-class AI clouds.” He specifically cited Nebius’s impressive customer list and Nvidia’s own experience working with the company: “We’ve worked with Nebius. They’re growing very fast.”^{[Motley Fool]}

On Wall Street, Freedom Capital Markets upgraded Nebius to “Buy” in a report just before the news broke.^{[CNBC (AMP)]} The upgrade came a week after Nebius closed a $775 million senior secured debt facility, backed by its deployed GPU infrastructure and a contract with an investment-grade customer. Freedom Capital Markets called the financing a “positive catalyst” for the company.^{[CNBC (AMP)]}

Nvidia’s AI Investment Map and Industry Concerns

Nvidia has been aggressively investing in the world’s most promising AI companies. According to CNBC, the company contributed $30 billion to OpenAI’s $110 billion funding round in March and participated in Anthropic’s $30 billion round in February.^{[CNBC (AMP)]}

On the hardware side, Nvidia’s contract manufacturer Wistron opened its D1 AI smart factory in Fort Worth, Texas, on July 22. The facility will produce Nvidia’s GB300 Grace Blackwell Ultra superchips and is expected to expand to the next-generation Vera Rubin superchips. Wistron shares jumped 9.7% on the day.^[CNBC]

But the massive spending on AI infrastructure is also raising debt-risk questions. A 24/7 Wall St. report, citing a Nikkei survey, found that five tech giants—Microsoft, Meta, Amazon, Alphabet, and Oracle—have hidden roughly $1.65 trillion in future lease and purchase obligations in SEC footnotes, mostly tied to AI infrastructure.^{[24/7 Wall St.]} Meta’s off-balance-sheet debt alone is estimated at $420 billion, three times its reported debt. Oracle’s off-balance-sheet commitments have ballooned roughly 30-fold in four years. The report warns that if AI demand falls short, these hidden lease commitments could turn into impairment losses.

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