Nebius Shares Fall as Short Interest Nears 20% Amid AI Concerns
Nebius shares extended a sell-off as short interest approached 20%, while the article cites Gartner's warning about potential impairment for neocloud firms by the end of 2030. The report also points to rising costs and financing challenges.
Nebius Group (NASDAQ: NBIS) extended its sharp decline as investors sold neocloud stocks amid continued concern about the artificial intelligence industry. Rising short positions have also contributed to the pressure on the shares, suggesting some traders anticipate further near-term losses. Short interest in Nebius is climbing toward 20% as U.S. investors bet against the company and other neocloud providers.
The increase accelerated after Gartner (NASDAQ: IT) warned that these firms could face substantial impairment at the end of 2030. Some prominent analysts have also cautioned that the AI bubble could burst. A collapse in the AI boom or a significant slowdown in growth would hurt Nebius, whose clients include Meta Platforms (NASDAQ: META) and Microsoft (NASDAQ: MSFT). The company also faces higher operating costs as chip, memory and server prices continue to rise, along with increasing depreciation expenses.
Its latest results showed depreciation up 245% in the In the second quarter, the amount was $259 million, a significant sum compared with revenue of $582 million. Read Also: Disney to Spend $60 Million a Year on Character.AI Talent After Its Own Layoffs as AI Startup Faces Bankruptcy Nebius also faces financing challenges as bond yields continue to rise. The ten-year Treasury yield has climbed to 5.3%, its highest level in two decades. That means the company will need to pay more for future debt financing.
CoreWeave (NASDAQ: CRWV) has seen its debt yields rise to 15%, and may choose to raise capital through equity. It raised over $2 billion in equity financing in the second quarter and has over $2 billion remaining that it can raise. Its outstanding shares have increased to 238 million from 200 million last year. Nebius Stock Technicals Suggest It Has More Downside NBIS stock chart | Source: TradingVideo The daily chart shows NBIS stock in a sharp sell-off this month.
It has fallen below the key support level of $194, its lowest level on September 2nd, and is approaching the 50% Fibonacci Retracement level. The stock has also moved below the 200-day Exponential Moving The Average (EMA) and Supertrend indicators suggest the stock may keep declining, potentially reaching $146, its lowest level in August. A drop below that level would point to further downside toward the 61.8% Fibonacci Retracement at $125.