Nebius, spun out of Yandex’s overseas operations last year, said the contract was valued at $17.4 billion but could rise to $19.4 billion if Microsoft demands more compute. The GPUs will come from a new data centre in Vineland, New Jersey, which Nebius plans to bankroll with cash flow and debt raised against the contract.

Investors lapped it up. Nebius shares jumped 68 per cent in after-hours trading to $108, while rival CoreWeave rose more than five per cent on expectations that the AI cloud gravy train is far from slowing down.

Nebius chief Arkady Volozh said: “The economics of the deal are attractive in their own right, but, significantly, the deal will help us to accelerate the growth of our AI cloud business even further in 2026 and beyond.”

GPUs have become the new collateral in the AI gold rush. CoreWeave, now valued at $45 billion, has borrowed over $12 billion against its GPU reserves and stitched up contracts with OpenAI worth roughly the same. Microsoft had already inked up to $10 billion in deals with CoreWeave last year before ditching an option for another $12 billion in capacity.

Redmond’s spending spree shows no signs of easing. In July, the company revealed its AI capex would hit $120 billion this year, up from $88 billion in 2024 and almost quadruple its 2023 outlay of $32 billion.

For Nebius, the Microsoft deal caps a remarkable turnaround. After Russia’s invasion of Ukraine in 2022, Yandex shares were suspended and the group was forced to sell its domestic operations to Kremlin-approved buyers for $5.4 billion. Nebius emerged from the wreckage and now finds itself supplying one of the biggest names in tech.