Nebius Falls 13% as Baird and BofA Cut Targets on Data Center Delays

Nebius Group stock fell 13% to $111.34 on November 13 after Baird and Bank of America cut their price targets, citing delays in activating third-party data center capacity. The drop extends a brutal month for the AI cloud operator, whose shares are now down 46% over the past four weeks.

Baird analyst Rob Oliver lowered his target on Nebius (NASDAQ: NBIS) to $200 from $340 while keeping an Outperform rating. In his view, the delays introduce a risk to the Nebius story that did not exist before.

Bank of America (NYSE: BAC) took its target down to $265 from $310 and kept its Buy rating. The firm reads the full-year outlook as implying a sequential fourth-quarter slowdown, with planned launches and their related revenue shifting from late 2026 into early 2027.

What caused the target cuts?

The resets follow Nebius's Q3 2026 report on November 12, which paired a revenue beat with a trimmed outlook and a larger spending plan. Third-quarter revenue came in at $980.8 million, above the $907.2 million consensus. But $325 million of that total came from non-recurring activity tied to the first phase of an asset-light partnership; without it, revenue would have landed below consensus.

Management now expects 2026 revenue at the low end of its prior $3 billion to $3.4 billion range, because third-party colocation deliveries slipped and New Jersey phases moved to Q2 2027. At the same time, the company raised its 2026 capital expenditure forecast to roughly $27 billion.

"The changes in our 2026 guidance are just about timing, not demand," the chief financial officer said on the earnings call.

How far did the selloff spread?

The decline hit the wider neocloud sector. CoreWeave (NASDAQ: CRWV) traded at $50.49, down 11%, despite raising its full-year revenue guidance when it reported on November 10. NVIDIA (NASDAQ: NVDA), a Nebius investor and partner, fell 4% to $159.49; it is also absorbing the impact of Jensen Huang's resignation as CEO on November 12.

Among the three, NVIDIA posted the smallest decline, and its main concern is its own leadership change rather than the colocation delays.

Why does the colocation layer matter?

Nebius runs a full-stack AI cloud. It owns data centers in Finland, Missouri and Alabama, and leases colocation space in the U.S., Europe, Israel and India. Through Token Factory it sells managed inference, and it owns side businesses including the Avride robotaxi unit and the TripleTen education platform. The current delays sit squarely in that leased colocation layer.

CoreWeave operates as a pure-play GPU cloud, funding expansion largely through debt facilities matched to customer contracts, convertible notes and customer prepayments. NVIDIA sits upstream, supplying chips and systems, including Vera Rubin, that both cloud providers deploy. All three depend on the same expansion cycle, in which power and construction timelines can slow revenue even when demand holds firm.

What is the next test for Nebius?

The company's next test is whether the delayed third-party capacity comes online in early 2027 as planned. CEO Arkady Volozh said on the call that "none of that capacity is canceled" and that the company's own sites remain "on track and even ahead of schedule." Nebius's initial 2027 outlook calls for revenue of $12 billion to $13 billion.

Bulls can point to Volozh's statement that "prepayments on Q3 agreements covered more than 100% of the associated capex." Bears counter that Nebius is lifting spending while pushing revenue out, leaving it more reliant on prepayments, convertible notes and asset-backed financing.

Further delays at third-party sites would add pressure on the company; on-time deliveries would ease the concerns behind the analyst cuts. The New Jersey capacity timeline, now pointing to Q2 2027, is the clearest signal of which way that balance breaks.