Nebius plans $40B AI data center spend for 2027 amid project delays

In short: Nebius says it plans to spend about $40 billion in 2027 to expand AI computing, funded largely by customer money paid upfront and loans tied to customer contracts.

What happened

Nebius, a company that rents out AI computing power, told investors it plans $40 billion of spending in 2027 to build more data center capacity. Data centers are large buildings filled with computers, like warehouses for processing and storage.

The company said it expects to pay for most of this buildout using customer prepayments and loans backed by signed customer contracts. Prepayments are when customers pay before the service is delivered, like paying a deposit months ahead of a home renovation.

This plan is being tested by delays at a data center site in Vineland, New Jersey, where Microsoft is a major customer. Nebius said its contract with Microsoft is worth up to $19.4 billion, but the site is months behind schedule, and only just over half of the Microsoft capacity is now planned to be delivered by the end of this year, with the rest expected in Q2 2027.

Nebius said the delay is linked to a third party operator, DataOne, changing its temporary power setup as the site switches to Bloom Energy fuel cells. The DataOne facility was also fined $1.1 million by New Jersey regulators after officials said natural gas generators were used without permits, according to Floodlight.

Why it matters

A financing plan built on prepayments and contract-backed loans works best when projects finish on time. If sites slip, costs can rise while expected revenue arrives later, and big customers may have options to cancel or demand penalties. Nebius shares fell 17% after the update, showing investors are watching execution risk closely.

Source: TechCrunch AI