Quick Read – Nikesh Arora warns neoclouds will lose pricing power when GPU supply catches up but singles out Nebius as a durable neoscaler. – Nebius has over $40 billion in contracted revenue from Microsoft and Meta, with $3 billion ARR and a 50% adjusted EBITDA margin. – Nebius…
osed a $5.75 billion convertible-note offering to fund expansion, making valuation discipline essential despite the compelling neoscaler thesis. – Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Palo Alto Networks didn’t make the cut. Grab the names FREE today
The AI infrastructure boom is creating a peculiar investing landscape. Demand for computing power is running ahead of available supply, allowing companies that own GPUs and data-center capacity to command premium prices. Nvidia (NASDAQ:NVDA) said its neocloud partners are expected to reach 8 gigawatts of installed capacity by the end of 2026, up from 3 gigawatts at the end of 2025.
Yet Palo Alto Networks (NASDAQ:PANW) CEO Nikesh Arora sees a reckoning coming when supply catches up. His warning is stark: “In two years from now you will be able to buy a neocloud for less than they raise at today.” But Arora doesn’t put every AI cloud company in the same bucket. He specifically sees Nebius Group (NASDAQ:NBIS) becoming a “neoscaler,” along with CoreWeave (NASDAQ:CRWV).