Microsoft has signed a cloud deal with Nebius Group worth up to $19.4 billion through 2031

Microsoft has signed a cloud deal with AI infrastructure provider Nebius Group NV worth up to $19.4 billion, running through 2031. Nebius, a Yandex spin-off backed by investors like Nvidia and Accel Partners, will supply Microsoft with computing power from a new data center in New Jersey starting in late 2025. The deal comes as Microsoft continues to face a shortage of capacity for AI cloud services, despite heavy investment in its own infrastructure. Microsoft plans to use Nebius's resources to support OpenAI until OpenAI's own "Stargate" infrastructure goes online. This move also lets Microsoft reduce its reliance on existing hosting partners such as CoreWeave and Oracle. Nebius expects significant growth from 2026 onward as a result of the agreement and is considering additional financing options.