Nebius Group has secured a $3.5 billion senior secured financing facility from Citi to support its expansion of AI data-center capacity. The Nasdaq-listed cloud company said the proceeds will be used for data-center development, purchases of graphics-processing units and general corporate purposes. Citi acted as mandated lead arranger, agent and security agent. The transaction gives Nebius another source of capital as AI infrastructure providers race to install computing capacity ahead of expected demand.

Short maturity, floating cost

The facility matures in 364 days. Its initial interest rate is Term SOFR plus 2.75% per year, with the spread able to increase to a maximum of 3.50%, subject to other adjustments. That structure makes the cost sensitive to short-term benchmark rates and means the company will need to repay, refinance or replace the facility within roughly a year. Nebius did not disclose a draw schedule, collateral details or financial covenants in its public announcement.

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Financing a capital-intensive buildout

AI cloud expansion requires large upfront spending on servers, GPUs, networking and power-intensive facilities before revenue arrives. Nebius described the Citi facility as part of a sequenced funding plan that also includes customer prepayments and operating cash flow. Chief Operating Officer Ophir Nave said the company could pursue asset-backed financing supported by more than $40 billion of long-term commitments from investment-grade customers. Reuters identified Microsoft and Meta among those customers and reported that Nebius has about $10 billion of convertible-bond debt outstanding after an August issuance.

Why the deal matters to investors

The new borrowing can reduce the pressure to issue longer-dated debt or equity immediately, giving management more choice over the timing and structure of its next capital raise. It also shows that a major bank is willing to provide secured financing against the company's buildout strategy. Because the facility is senior and secured, however, its claims would generally sit ahead of unsecured obligations if the company encountered financial distress. But a committed facility is not the same as profitable capacity. Returns depend on whether Nebius can bring sites online on schedule, secure hardware and electricity, control construction costs and convert contracted demand into cash flows.

The risk sits beyond the headline number

A short-term secured line can bridge construction and procurement, but it also concentrates refinancing risk. If benchmark rates stay high or AI-infrastructure credit conditions weaken, replacement funding could become more expensive. The company also competes with larger cloud providers and specialist operators for GPUs, customers and power. Nebius cautioned that market conditions, pricing pressure, technology changes, sales cycles and its ability to raise additional capital could cause actual results to differ from its plans.

What to watch next

Investors will need to see how much of the $3.5 billion Nebius draws, which projects receive the capital and whether those assets produce contracted revenue before the facility matures. Future filings may provide more detail on collateral, covenants, interest expense and the interaction with existing convertible debt. The central question is not simply whether AI demand remains strong, but whether Nebius can match the pace of spending with dependable utilization and cash generation. The Citi facility expands its financing toolkit; it does not remove the execution and balance-sheet risks of building AI infrastructure at scale.

Sources

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