Nebius Group N.V.

Welcome to Nebius Group's Q2 2026 earnings conference call. The presentation will be followed by a Q&A session. If you would like to ask a question, you can click on the ask a question tab in the top right of the live stream player, then just type in your question and click submit. You can submit questions at any time during the presentation, and the Nebius management team will try and answer them during the Q&A portion of the call. I will now hand over to Gili Naftalovic, Head of Investor Relations, to start the call.

GILI NAFTALOVIC Hi, everyone, and welcome to Nebius' second quarter 2026 earnings conference call. Joining us on the call today, we have our CEO Arkady, our CFO Dado, and the broader Nebius management team. Before we get started, I'll quickly cover the safe harbor. Some of the statements that we make today regarding our business operations and financial performance may be considered forward-looking. Such statements are based on current expectations and assumptions that are subject to a number of risks and uncertainties. Actual results could differ materially. Please refer to our Form 20F for a list of our risk factors. We undertake no obligation to update any forward-looking statements. During this call, we will present both GAAP and non-GAAP financial measures. A reconciliation of non-GAAP to GAAP measures is included in today's earnings press release. All earnings-related documents are distributed and available to the public through our investor relations website, which can be found at nebius.com. And now, I'd like to turn the call over to Arkady.

Thanks, Gili, and welcome everyone to our call today. I would like to provide our investors with a better understanding of our business model. We had an excellent quarter. The demand for what we're building continues to be enormous, and we have the right business model to capture it. We build capacity ahead of contracts and use our multi-tenant cloud and our software stack to support our customers, AI natives, agentic AI leaders, new labs, and some of the most sophisticated enterprises. Our strategy is working. We choose when to sell, to whom we sell, and on what terms. And how we finance everything. This flexibility allows us to meet the needs of independent AI builders and to support an open, diverse, and competitive market. We address customer needs with three types of deals. Each has a different duration, pricing, and role in our business. First, for our core AI cloud business. We have mid-term contracts of one to three years with the world's most ambitious AI companies. This quarter alone, we closed four landmark deals with Reflection, Cohere, as well as with a scale U.S. Neolab, and a large U.S.-based quant trading firm. These deals were for an average of more than a billion dollars each. They represent a yield of 20 to 25 million dollars per megawatt with upfront payments that cover 50-60% of the associated capex. But most importantly, we could sell today our entire 2027 capacity on these terms if we wanted to. But we are not doing this. We see that we can achieve higher value by retaining some capacity to serve shorter term and immediate client needs. And here we come to the second type of deal. This is shorter duration capacity, typically for up to six months for customers with an immediate time bounded needs with high value requirements. For this, they are ready to pay a significant premium. We're negotiating deals for 40 to 50 million dollars per megawatt range and sometimes above under this model. One of such deals has been signed just recently, by the way. Both deal terms I just described are all coming online later this year, so they will not have a material effect on our 2026 revenue guidance. However, they will be They will definitely affect our 2027 revenue and beyond. The third deal type, as we noted many times in the past, is our long-term contracts with investment-grade customers. They serve an important purpose. They help us to finance our build-out faster and more efficiently. The secured debt facility we raised in July was on the back of one of these deals. And with $40 billion in contracted backlog, we will do more of this. We're constantly building, innovating, and developing our software stack, talking about offerings and services. But today, I would like to focus on different types of innovations from this quarter. We launched our first capacity auction. It was very successful and cleared at the highest price we have seen for the Blackwell generation of chips, 15% above the highest price we ever charged before. This gives us a strong signal on the value of this capacity in the market in real time. This was an innovation of sorts on the go-to-market side. On the capacity side, we're also innovating in how we build. For example, our asset-light partnership model, which we introduced this quarter, provides an additional way for us to scale. This model addresses the two constraints of our industry, which is capital and capacity. Partners finance, build, and operate the facilities, whereas Nebius brings the full-stack platform and the demand. We provide value-added services that sit on top of our partners' infrastructure, which delivers us with high margin revenue and requires minimum balance sheet capital. This model has the potential to unlock new capacity for us in 2027 and beyond. We continue to build our future capacity pipeline through our own and collocated sites, and today raise our year-end contracted power target to 5 gigawatts. Our future capacity pipeline effectively makes Nebius one of just a few companies in the world able to build more than one gigawatt of new capacity a year. And we plan to do so in 2027. So to close, everything we set out to do this quarter, we have done. And in most cases, we have done more. Landmark deals in our core market on better terms than we expected. Capacity rising to meet demand. and the platform meeting the needs of the industry. We are not just reporting a strong quarter behind us. It's much more than that. We see the demand, we see the supply, we see deal terms for 2027 and beyond. Even our future capacity plans, including for 2027, we cannot be more excited about the future. And on this optimistic note, let me hand it over to Dado.