Nebius Just Raised $5 Billion in Convertible Notes Against a $1.4 Billion Revenue Base. Are We In a Bubble?
The AI cloud company borrowed three and a half times its annual revenue in one deal. The terms show what building at its pace costs.
Overview
Nebius Group (NASDAQ:NBIS) announced a proposed $4.5 billion convertible note offering on Wednesday, and shares of the artificial intelligence (AI) cloud company fell about 10% on the news. By that evening, the deal had been upsized and priced. Nebius sold $5.0 billion of convertible senior notes, expected to settle on Aug. 24, with net proceeds of about $4.94 billion.
For scale, Nebius has generated $1.36 billion of revenue over the past 12 months. The company just borrowed more than three and a half times that in a single transaction.
Details
The size (and a share exchange that came along with it) helps explain Wednesday's drop. The terms are worth attention too, because they spell out what building at Nebius's pace costs, and who pays.
Source
Originally published at www.fool.com.