Nebius Group
Exhibit 99.1 Nebius Group N.V. announces fourth quarter and full-year 2024 financial results
Amsterdam, February 20, 2025 - Nebius Group N.V. ("Nebius Group", the "Group" or the "Company"; NASDAQ: NBIS),(1) a leading AI infrastructure company, today announced its unaudited financial results for the fourth quarter and full year ended December 31, 2024.
Arkady Volozh, founder and CEO of Nebius Group, said: "The fourth quarter was extremely eventful for Nebius. Our shares resumed trading on Nasdaq in October, and we went on to raise $700 million in December in an over-subscribed capital raise from top-tier partners including Nvidia, Accel and Orbis. "We made rapid progress in expanding our AI infrastructure footprint, announcing our first new GPU cluster deployment in the U.S. and adding capacity in Europe. On the software side, we launched our new AI-native cloud platform, built from the ground up, and our inference platform, AI Studio. "In Q4 we also focused on building out our sales function, and we are now seeing the results. More clients are coming onto the platform, and our more diversified customer base is already contributing to strong growth in annualized run-rate revenue (ARR)(2). Based on contracts already in place, March ARR will be at least $220 million, and we have additional potential deals in the pipeline. "Given this momentum, as well as the anticipated impact of additional data center capacity and Blackwell GPUs coming on-stream later this year, I am pleased to confirm that our projected December 2025 ARR of $750 million to $1 billion is well within reach." Q4 and full year 2024 financial and operational highlights Nebius Group
(1) Results include consolidated financial results of: Nebius, the core AI infrastructure business; Toloka, an AI development platform; TripleTen, an edtech service; and Avride, an autonomous vehicle platform. (2) ARR is defined as annualized run-rate revenue by the end of the period (revenue for last month of the period multiplied by twelve).
Consolidated results (1), (2)
(1) The following measures presented in this release are "non-GAAP financial measures": Adjusted EBITDA / (loss) and Adjusted net loss. Please see the section "Use of Non-GAAP Financial Measures" below for a discussion of how we define these measures, as well as reconciliations at the end of this release of each of these measures to the most directly comparable U.S. GAAP measures. (2) Following the completion of the divestment of the Russia-based businesses, the Group changed the reporting currency from the Russian Ruble to the United States Dollar, which better reflects the geography of operations and key focus markets of the remaining businesses. Financial statements for the prior periods have been restated as if the change had occurred on January 1, 2022.
Webcast information Nebius Group's management will hold an earnings webcast on February 20, 2025 at 8:00 AM (EDT) / 5:00 AM (PDT) / 2:00 PM (CET). To access the webcast, please follow the link: https://goldmansachs.zoom.us/webinar/register/WN_2bInT9H2Q4KOyvjSewG_cw Corporate and subsequent events
Loss from operations
Loss from operations amounted to $151.2 million in Q4 2024 compared to $93.5 million in Q4 2023. This reflected continuing investments to support the planned growth of our businesses. Other income/(loss), net for Q4 2024 amounted to a loss of $8.4 million compared to income of $1.0 million in Q4 2023. Other income/(loss), net includes foreign exchange loss of $9.4 million in Q4 2024 and a foreign exchange gain of $0.9 million in Q4 2023. Net loss from continuing operations was $136.6 million in Q4 2024, compared with net loss of $88.3 million in Q4 2023. The increased losses is primarily due to an increase in operating expenses as a result of expansion of our businesses, as well as increased share-based compensation expense of $40.9 million in Q4 2024 compared to $7.7 million in Q4 2023. The increase in operating expenses was partly offset by interest income of $21.9 million in Q4 2024 compared to $0.6 million in Q4 2023.
A significant portion of the consideration for the divested businesses was received in the form of the Company's Class A Shares. The acquisition of such shares by the Company is treated as a repurchase by the Company of its own shares for Dutch tax purposes, which would be subject to withholding tax at a rate of 15%, unless the shares so acquired qualify as "temporary investments". Based on the Company's use of a portion of these shares in 2024 for financing purposes and the Company's equity incentive program, in Q4 2024 the Company has accrued a contingent tax liability in respect of approximately 117 million Class A shares in the amount of $180.9 million. Outstanding Shares; Convertible Note Settlement; Equity Awards The total number of shares issued and outstanding as of December 31, 2024 was 235,753,600, including 200,054,926 Class A shares and 35,698,674 Class B shares, and excluding 126,287,344 Class A shares held in treasury. The total number of Class A shares received as a part of consideration for the divestment was 162,485,725 Class A shares, which are held in treasury pending use under the Company's equity incentive plans and for financing purposes. In connection with the settlement of the Company's $1.25 billion convertible notes in 2022, the Company agreed to transfer an aggregate of approximately 5.7 million Class A shares to former noteholders. Of this total, approximately 2.5 million shares were delivered in 2022; and approximately 3.1 million further shares have been delivered in 2024. The Company has obligations to deliver up to approximately 100,000 additional Class A shares to remaining former noteholders. As of December 31, 2024, there were also outstanding employee share options to purchase up to an additional 0.8 million shares, at a weighted average exercise price of $40.00 per share, all of which were fully vested; equity-settled share appreciation rights (SARs) for 0.1 million shares, at a weighted average measurement price of $32.85, all of which were fully vested; restricted share units (RSUs) covering approximately 9.9 million shares, of which RSUs to acquire 0.8 million shares were fully vested. In addition, the Company has outstanding awards in respect of the Avride business for 1.2 million shares (representing 3.6% of fully diluted shares in Avride), 1.1 million of which were fully vested. About Nebius Group Nebius Group is a technology company building full-stack infrastructure to service the high-growth global AI industry, including large-scale GPU clusters, cloud platforms, and tools and services for developers. Headquartered in Amsterdam and listed on Nasdaq, the Company has a global footprint with R&D hubs across Europe, North America and Israel. Nebius Group's core business is an AI-centric cloud platform built for intensive AI workloads. With proprietary cloud software architecture and hardware designed in-house (including servers, racks and data center design), Nebius Group gives AI builders the compute, storage, managed services and tools they need to build, tune and run their models. The group also operates three additional businesses under their own distinctive brands:
More information about Nebius Group can be found at https://group.nebius.com.
FORWARD-LOOKING STATEMENTS This press release contain forward-looking statements that involve risks and uncertainties. All statements contained or implied other than statements of historical facts, including, without limitation, statements regarding our review of strategic options to accelerate growth, business plans, market opportunities, capital expenditure requirements, financing requirements and projected financial performance, are forward-looking statements. In some cases, these forward-looking statements can be identified by words or phrases such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to" or other similar expressions. In addition, these forward-looking statements reflect our current views with respect to future events and are not a guarantee of future performance. The potential risks and uncertainties that could cause actual results to differ from the results predicted or implied by such statements include, among others, our ability to successfully operate and develop a fundamentally different, early-stage group following the divestment of a significant portion of our historical operations; to implement our business plans; to continue to successfully capture customers; to continue to successfully obtain required supplies of hardware on acceptable terms; and to obtain any further debt or equity financing that may be necessary to achieve our objectives. Many of these risks and uncertainties depend on the actions of third parties and are largely outside of our control. Notwithstanding the completion of the full divestment of our Russian businesses, we also continue to be subject to many of the risks and uncertainties included under the captions "Risk Factors" and "Operating and Financial Review and Prospects" in our Annual Report on Form 20-F for the year ended December 31, 2023 and "Risk Factors" in a shareholder circular filed as Exhibit 99.1 to a Report on Form 6-K filed with the U.S. Securities and Exchange Commission ("SEC") on February 8, 2024, which are available on our investor relations website at https://group.nebius.com and on the SEC website at www.sec.gov. All information in this release is as of February 20, 2025, and the Company undertakes no duty to update this information unless required by law. In addition, statements that "we believe" and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this press release, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely upon these statements. USE OF NON-GAAP FINANCIAL MEASURES To supplement the financial information prepared and presented in accordance with U.S. GAAP, we present the following non-GAAP financial measures: Adjusted EBITDA/(loss) and Adjusted net income/(loss). The presentation of these financial measures is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with U.S. GAAP. For more information on these non-GAAP financial measures, please see the tables captioned "Reconciliations of non-GAAP financial measures to the nearest comparable U.S. GAAP measures", included following the accompanying financial tables. We define the various non-GAAP financial measures we use as follows:
These non-GAAP financial measures are used by management for evaluating financial performance as well as decision-making. Management believes that these metrics reflect the organic, core operating performance of the company, and therefore are useful to analysts and investors in providing supplemental information that helps them understand, model and forecast the evolution of our operating business. Although our management uses these non-GAAP financial measures for operational decision-making and considers these financial measures to be useful for analysts and investors, we recognize that there are a number of limitations related to such measures. In particular, it should be noted that several of these measures exclude some recurring costs, particularly certain share-based compensation. In addition, the components of the costs that we exclude in our calculation of the measures described above may differ from the components that our peer companies exclude when they report their results of operations. Below we describe why we make particular adjustments to certain U.S. GAAP financial measures:
Net income/(loss) from discontinued operations
Net income/(loss) from discontinued operations represent the results of the divested business, net of tax, net income from discontinued operations attributable to noncontrolling interests, income/(loss) from revaluation of investment in equity securities held for sale and the result of divestment. Following the first closing of the divestment, the Company held a remaining interest of approximately 28% in businesses to be divested. This investment was subject to revaluation due to RUB / USD exchange rate fluctuations. Result of revaluation of investment in these businesses in 2024 was presented within Net income/(loss) from discontinued operations. Result of the divestment is calculated as fair value of consideration received plus fair value of the remaining interest in the divested businesses and accumulated other comprehensive loss related to the sold perimeter less net assets of the disposed business as of first closing of the divestment. We present Adjusted net loss ex?luding any effects of our discontinued operations.
Certain SBC expense
SBC (Stock-Based Compensation) is a significant expense item and an important part of our compensation and incentive programs. As it is highly dependent on our share price at the time of equity award grants, we believe that it is useful for investors and analysts to see certain financial measures excluding the impact of these charges in order to obtain a clearer picture of our operating performance. However, because we settled some RSU equity awards of our employees granted before 2022 in cash during 2023 and 2024, we no longer eliminate the relevant SBC expense corresponding to the cash payment from Adjusted EBITDA/(loss) and Adjusted net income / (loss).
Foreign exchange gains/(losses)
Because we hold certain assets and liabilities in currencies that differ from the United States Dollar, the Company's current reporting currency, and because foreign exchange fluctuations are outside of our operational control, we believe that it is useful to present Adjusted EBITDA/(loss), adjusted net income/(loss) and related margin measures excluding these effects, in order to provide greater clarity regarding our operating performance.
One-off restructuring and other expenses
We believe that it is useful to present Adjusted net income/(loss), Adjusted EBITDA/(loss) and related margin measures excluding impacts not related to our operating activities. Adjusted net income/(loss) and Adjusted EBITDA/(loss) exclude certain expenses related to the divestment and other similar one-off expenses.
The tables at the end of this release provide detailed reconciliations of each non-GAAP financial measure we use from the most directly comparable U.S. GAAP financial measure.
Nebius Group N.V. Unaudited Condensed Consolidated Balance Sheets (in millions of U.S. dollars)
* Derived from audited consolidated financial statements and adjusted for the presentation of discontinued operations, change in reporting currency and other revision adjustments Nebius Group N.V. Unaudited Condensed Consolidated Statements of Operations (in millions of U.S. dollars)
* Derived from audited consolidated financial statements and adjusted for the presentation of discontinued operations, change in reporting currency and other revision adjustments
(1) These balances exclude depreciation and amortization expenses, which are presented separately, and include share-based compensation. (2) Net income from discontinued operations represents the results of the divested businesses, net of tax and third party exit or disposal costs. For 2024 such results are presented only till the date of the first closing of the divestment when the Company sold its controlling stake in the businesses to be divested and deconsolidated the disposed businesses. (3) Loss from disposal represents both the impairment of the held-for-sale component in Q1 2024 and the result of the deconsolidation as of the date of the first closing of the divestment. Such effects include the reclassification of the accumulated other comprehensive loss from equity to earnings which resulted from the change in reporting currency and attributable to the divested businesses.
Nebius Group N.V.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES TO THE NEAREST COMPARABLE U.S. GAAP MEASURES
Reconciliation of Adjusted EBITDA / (loss) to U.S. GAAP Net Income / (loss)
Reconciliation of Adjusted Net Income / (loss) to U.S. GAAP Net Income / (loss)
Contacts:
Investor Relations askIR@nebius.com
Media Relations media@nebius.com Dissemination of a CORPORATE NEWS, transmitted by EQS Group. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2089239 20-Feb-2025
