Nebius sells $4.5B of converts and loses 13% of its share price the same day

Nebius Group said it would sell $4.5 billion of convertible senior notes, split into $2.75 billion due 2030 and $1.75 billion due 2034, and the stock fell 13%, from $248.43 to $215.52 ^[1][2][3]. That is the third multi-billion-dollar convertible the Amsterdam-headquartered, Nasdaq-listed company has issued within a year ^[4][5], and the reaction was to the structure of the money rather than to demand for what it buys.

The initial purchasers also got options on a further $375 million of the 2030 tranche and $300 million of the 2034s, which could take the total above $5.17 billion ^[6]. The notes are unsecured senior obligations sold privately to qualified institutional buyers under Rule 144A ^[7]. Proceeds, per the SEC filing, go to data center construction, expansion of the full-stack AI cloud platform, GPU and component procurement, and general corporate purposes ^[8].

The part that moved the price is attached to the old paper. Nebius intends to strike private agreements with holders of its 2.00% notes due 2029 and 3.00% notes due 2031 to exchange some of those for Class A ordinary shares, and the filing itself flags the risk that holders who accept will sell the shares or unwind their hedges ^[9][10]. Convertible dilution normally sits in the future. An exchange moves part of it into the present, and the hedging behaviour of convertible funds moves it into this week ^[11].

The pattern predates this deal. After closing its $17.4 billion Microsoft agreement in September 2025, Nebius raised $3 billion through convertible notes and Class A shares ^[12]; it took $2 billion of equity from NVIDIA, raised $4.34 billion of converts in March 2026, arranged a $775 million senior facility in July 2026 secured on GPU infrastructure and customer cash flows, and bought Eigen AI for $643 million ^{[13][14][15][16]}. The three convertible rounds alone come to about $11.84 billion, or up to $12.51 billion if the new options are exercised ^[1][2].

The reason the issues keep coming is in the capex line. In March, chief communications officer Tom Blackwell said the company was well funded for 2026 capital spending of $16 billion to $20 billion ^[17]; by the first quarter that guidance had gone to $20 billion to $25 billion on faster capacity sales, a 25% increase at both ends ^[18][3]. Nebius plans to fund roughly 60% of growth from customer prepayments, mainly Microsoft and Meta, and 40% from equity and debt ^[19], which at current guidance implies $8 billion to $10 billion of equity and debt for the year ^[4]. It ended the second quarter with $8.04 billion of cash after spending $5.66 billion on property, equipment and intangibles in that quarter alone, about 1.4 quarters of cover ^[20][21][5]. Group revenue was $582.3 million, up 454% year on year, with the company still unprofitable and an adjusted EBITDA margin of 45% against 24% a year earlier, below the level of capital spending ^[22][23][24]. The new raise is roughly 7.7 times a quarter of revenue ^[6].

What to watch: whether the 2029 and 2031 holders actually sell into the market once exchange terms are set, since that is the mechanism the filing warns about ^[10]; the next capex revision, because each one has arrived with a financing attached; whether the prepayment share holds at 60% as the absolute numbers grow ^[19]; and how long the 197% year-to-date gain keeps convertible terms cheap ^[25]. The cushion, not the cycle, is what is being spent here.