Meta Spends $27 Billion on Nebius AI Computing Power, Sparks Arms Race with OpenAI and Google

Tech Home, March 16 — Meta will pay up to $27 billion (IT Home note: approximately 186.571 billion RMB at current exchange rates) to cloud service provider Nebius Group NV over the next five years to gain access to its cutting-edge AI infrastructure. The company is making significant investments to compete with industry-leading large models.

Dutch company Nebius is a new cloud service provider operating data centers and has a strategic partnership with NVIDIA. Starting early 2027, it will provide Meta with dedicated computing power valued at $12 billion. Additionally, Meta has committed to purchasing up to $15 billion in extra computing resources, which will be built by the cloud provider for third-party clients.

This expenditure is one of Meta’s largest single contracts, highlighting that the parent company of Instagram and Facebook is fully committed to acquiring more computing power to support AI product development. Last year, Meta signed a $3 billion standalone cooperation agreement with Nebius.

Nebius’s stock price surged 15% in pre-market trading. The stock closed at $112.95 last Friday in New York, nearly tripling over the past 12 months. Meta’s stock rose 2.8% in pre-market trading, after closing at $613.71.

Market analysts expect Meta and other major tech giants to invest approximately $650 billion by 2026 in building data centers and other infrastructure to prepare for explosive growth in AI services in the coming years. Meta has prioritized AI as its core strategic focus and is heavily investing to compete with rivals like OpenAI and Google. Since the beginning of this year, the company has also signed AI infrastructure cooperation agreements worth billions of dollars with NVIDIA and AMD, while also developing its own chips.

Meta CEO Mark Zuckerberg stated last year that by 2028, Meta will invest $600 billion in U.S. infrastructure projects. The company is funding these projects partly through profits from advertising and partly through external financing. Meta is developing advanced large models internally and has launched multiple AI products, including chatbots that can be used across various applications.

A Meta spokesperson confirmed the partnership with Nebius and said that its diversified AI partnerships and technology stack strategy are part of “building more resilient and flexible infrastructure.”

Nebius is headquartered in Amsterdam and spun off from Russian internet giant Yandex in 2024. Amid the AI boom, it is one of the few new vendors seizing the opportunity, focusing on building data centers for training large models and running ChatGPT-like services.

NVIDIA is deploying substantial funds to support these new cloud service providers, competing with major cloud providers like Google and Amazon. Last week, NVIDIA announced a $2 billion investment in Nebius, causing the Dutch company’s stock to jump 16%.

Most of NVIDIA’s large-scale funding flows into companies purchasing its chips, which has also sparked criticism, suggesting that this cycle of investment may be fueling a bubble. In January this year, NVIDIA announced a $2 billion investment in its competitor CoreWeave Inc. to deploy its products. NVIDIA also invested $30 billion in OpenAI this year and participated in a $2 billion funding round for the UK-based cloud service provider Nscale.