Nebius Borrows $3.5 Billion From Citi for 364 Days, and the Stock Drops 7 Percent

Nebius Group, the Amsterdam-based AI cloud company that rents out Nvidia-based computing, has secured a $3.5 billion senior secured financing facility from Citi, with the bank acting as mandated lead arranger, agent and security agent. The facility matures in 364 days and initially prices at Term SOFR plus 2.75 percent, with the margin able to rise to a maximum of 3.50 percent. Proceeds are earmarked for data center development, GPU purchases and general corporate purposes.

The market read the term sheet as a warning rather than a win. Nebius shares fell 7.3 percent on Thursday to $158.89, though the stock is still up about 90 percent year to date. A facility that matures in under a year is a bridge, not project finance: it implies the company expects to refinance into longer paper, or repay from contracted revenue, within twelve months while it keeps building.

The cost of that bridge has crept up. Nebius's first secured facility, signed in July, raised $775 million at 2.5 points over SOFR. The Citi deal starts a quarter point higher, which is a modest premium rather than a distress signal, but it does point one direction. The new borrowing stacks on roughly $10 billion of convertible notes already outstanding, including a $5.75 billion offering completed in August.

Chief operating officer Ophir Nave described the sequencing as deliberate: "Sequencing our financing is how we optimize our long-term cost of capital." Nebius says it can later tap asset-backed financing tied to more than $40 billion of long-term contracts with investment-grade customers, which is the collateral argument behind the short-dated loan.

The demand side of the story is unusually well documented for a company this size. Nebius began publishing live spot prices for its GPU capacity on October 21, with the figures also appearing on outside platforms such as Silicon Data. A day earlier, revenue chief Marc Boroditsky told CNBC that a capacity auction had shown rental prices still climbing faster than expected, and drew a line between Nebius and CoreWeave, where the cost of insuring debt against default had reached distressed levels. "We are not carrying the kind of debt that they are," he said.

Publishing spot prices cuts both ways. It answers the question investors keep asking about how quickly Nvidia hardware loses economic value, but it also hands lenders and shareholders a live scoreboard. If rental rates slip, everyone sees it in real time. Nebius is separately piloting rebates for customers who release idle reserved GPUs back into its spot pool, an implicit acknowledgment that some committed capacity sits unused even as the company argues demand outruns supply.

Nvidia holds a 9.3 percent beneficial stake in Nebius following a $2 billion investment earlier in 2026, a relationship that ties the chip supplier to one of its larger European channels. Nebius reports European capacity across six countries from Finland to Iceland and has added $10 million in compute grants to attract regional builders. Named workloads are modest but concrete: Prosus says Nebius inference doubled throughput for its e-commerce businesses, and neobank bunq runs its Finn assistant on the platform at what the company describes as 60 percent of the cost per answer of leading closed models.

The financing question that matters for the whole neocloud sector is what happens at maturity. Nebius is betting that by late 2027 its contracted revenue and asset base support cheaper, longer debt. If AI rental prices hold, that bet looks conservative. If they soften, a 364-day facility becomes a refinancing cliff at exactly the moment the collateral is worth less than the model assumed, which is why the tenor of this loan is a more interesting number than its size.