Nebius Group N.V.

Welcome to Nebius Group's second quarter 2025 earnings conference call. Joining me today are Arkady Volosh, founder and CEO, and our broader management team. Our remarks today will include forward-looking statements, which are based on assumptions as of today. Actual results may differ materially as the results of various factors, including those set forth in today's earnings release, and in our annual report on Form 20F or filed with the SEC. We undertake no obligation to update any forward-looking statements. During this call, we will present both GAAP and certain non-GAAP financial measures. A reconciliation of GAAP to non-GAAP measures is included in today's earnings press release. The earnings press release, shareholder letter, and accompanying investor presentation are available on our website at .nebius.com forward slash investor dash hub. And now I'd like to turn the call over to Arkady.

Thanks, Neil. And thank you to everyone for joining the call today. I'm pleased to say that we had an excellent quarter. We more than doubled our revenue for the whole group from Q1. And this quarter, we also became EBITDA positive in our core AI infrastructure business ahead of our previous projections. We could grow faster, but we were oversold on all of our supply of previous generation hoppers. And we decided to wait for the new generation of GPUs to come. And finally, the new black belts are coming to the market in masses. And in parallel, we are dramatically increasing our data center capacity. That's why we expect to significantly increase our sales by the end of this year. And that's why we are increasing our ARR guidance for the year end from the previous $700 to $1 billion to a new guidance, which is now $900 to $1.1 billion. More color on capacity front. And I see this as one of the most important updates of this call. We are aggressively ramping up. By the end of this year, we expect to have secured 220 megawatts of connected power that is either active or ready for GPU deployment. And this expansion includes our data centers in New Jersey and Finland. In addition, we have nearly closed on two substantial new greenfield sites in the United States. And overall, we're in the process of securing more than one gigawatt of power by the end of 2026 to capture industry growth next year. In addition, we made big enhancements to our software cloud platform, obviously, to support our expanding capacity and to meet the demand of those large scaling clusters. Also, we continue to significantly expand our customer base. We started to gain real traction on the enterprise side, adding large global technology customers such as Cloudflare, Prosus, and Shopify. And we still remain a leading new cloud provider for so-called native AI tech startups. We have added customers like Hygen, Lightning AI, PhotorOOM, and many, many others. On the financing front, as you already know, we are fortunate to have multiple levers to finance our ambitious growth. We have raised over $4 billion in capital so far. We have a strong balance sheet, as you can see. And we have access to potentially billions of dollars more thanks to our non-core businesses and other equity stakes such as AV Ride, ClickHouse, and Talocan. In short, this is an exciting time for neighbors. We are in the midst of a -a-generation opportunity. That's what we believe in. The demand for AI compute is strong and will just get stronger. We are rapidly increasing our capacity to pave the way for accelerated growth in 2026 and beyond. Well, and with that, let me introduce our new Chief Financial Officer, Dada Alonso. Dada, welcome again, and the floor is yours.

Thank you, Arkady. I'm really excited to be joining Nebius. I've long believed that AI will fundamentally transform our world, and Nebius is well positioned to make that happen. Of course, I'm also looking forward to getting to know our investors and analysts over the coming months. While the details of our Q2 financial performance can be found in our shareholder letter, I'd like to highlight a few key items and then conclude with guidance. We reported $105.1 million in revenue, up 625% year over year and up 106% quarter over quarter, driven by a strength in our core business and a solid execution from our Triple 10 team. Our AI cloud infrastructure revenue increased more than nine times year over year, driven by strong customer demand for our corporate GPUs and near peak utilization of our platform. Even as we achieve hyper growth, we continue to operate with discipline. This focus allowed us to achieve positive adjusted EBITDA in our core business ahead of our expectations. Below the operating income loss line, we recorded a gain from revaluation of investment in equity securities related to our equity investment. We also reported a gain from discontinued operations. These two non-business related items made us, for the quarter, got net income profitable. It is important to notice that we view these gains and one time in nature. Turning to guidance, we see very strong momentum in our business and demand for AI compute remains exceptionally high. Given our plans to further scale our platform this year, we are updating our full year outlook. For annualized run rate revenue, as Althadi already mentioned, we are raising guidance from $750 million to $1 billion to $900 million to $1.1 billion. This is based on close contracts for existing and future capacity, as well as sales we anticipate for the rest of the year. For our core business revenue, we are maintaining our guidance of $400 to $600 million. Let me share a few points. We continue to experience strong demand in our building capacity to take advantage of the large opportunity in front of us. Of the 220 megawatts of connected power we expect to have at the end of the year, we will have 100 megawatts of active power. And as we are building out our data center capacity, most of our GPU installations will take place in Q4. So we expect our annualized run rate revenue and revenue to be backed and weighted. For group revenue, we are keeping the projections that we already provided, that is group revenue of $450 to $630 million. This excludes the 2025 revenue guidance of $50 to $70 million we previously gave for Toloca. As we announced effective from Q2, we have the consolidated Toloca from the group. Turning to adjusted EBITDA, as we previously announced, we expect to be slightly positive by the end of the year at group level, but still we will be negative for the full year. Finally, we are maintaining our CAPEX guidance of around $2 billion in 2025. So in closing, we are experiencing hypergrowth with demand to support continued strong results. We are investing in capacity to capture the large and growing opportunity in front of us and our position in the company to become a leader in AI cloud infrastructure. Look, I truly believe the future of Nebius is incredibly bright. We're not just well positioned. We have the resources, the expertise, and most importantly, the team to lead and win. Now, let me turn the call over to Neil for Q&A.