NBIS is extremely bullish due to rising GPU prices (effective Oct 1) and strong contract economics ($40M+/MW for short-term, <1yr payback).

On today's episode, what I really want to cover is two NeoCloud players, Nebius and Core just reported some amazing announcements.

All right, so I want to start off with Nebius Nibbius. This is a community favorite, right there. This is probably one of the most popular NeoCloud stocks out right now. I also do want to say it's the best performing.

I think year to date, the stock is up about 126%.

So the stock, there were news last night that Nebius is raising on demand GPU prices effective on October 1st. Nebas is increasing pricing across Nvidia GPUs. The H100 saw an increase of about 17%.

The H200 saw an increase of about 20%. The B200 saw an increase of about 19% and the B300 saw an increase of roughly 21%. Which is wild.

The first thing is it's really exciting to see GPU prices continue to go up for the Neocloud market, right? Because this is a market that when they built a lot of these data centers, they did not model it where H100s or any forms of GPU prices will rise, right?

They actually modeled the opposite. They modeled that these prices would actually decrease over time. And if you are seeing the complete opposite, this means that whatever they modeled is very very conservative to some of the things that they're actually going to be seeing.

And now if they have better free cash flow, if they have better operating cash flow, you're most likely also going to see them kind of be very aggressive. But overall very very bullish.

Now if we kind of look at Nebia's recent earnings, they did share kind of where the pricing are of certain contracts. They mentioned that their typical contracts are about 20 million per megawatt deals and these are less than 2-year payback period and they're starting to come online right now.

If you are choosing long-term or short-term contracts, short-term contracts are actually sitting at around 40 over $40 million per megawatt, which is extremely extremely strong, right?

If you're pretty much paying what 50 billion per me uh per megawatt of data centers, you have nearly nearly a year payback on some of these short-term contracts, which is pretty pretty exciting.

So, these pricings, I don't think should be necessarily new news. It's good to actually see the results and the numbers, but we did hear from management's prior communication that price increasing was continuing.

Now, it is great to kind of see this play out. And I do believe during the earnings, they also talked about certain pricing effectiveness starting in October.

And it is great to see kind of the pricing per megawatt to go up a nice amount, right? Over 40 million for short-term capacity. And if we continue to see the supply demand in balance, right, between how much compute we have and how much compute is needed, you're going to continue to see pricings go up and up and up.

As long as there is value. And that's what it's it to me gets me more excited. If you're willing to pay 40 million per megawatt, it means you're making a lot more money as in either either if you're a AI company selling those tokens, you're selling those tokens at a higher value.

Maybe you're selling them at 70 million per megawatt. So, it makes sense even if the prices increases. And the other thing is if data AI companies are able to sell tokens at an inflated price as well, it's because the person that's buying those tokens is receiving or or is getting a form of benefit whatever they're doing.

I know we've heard financial institutions out of those 70 million per megawatts that they pay the AI companies for token, they're probably making over a 100red million in per megawatt, right?

So as long as the end customer is still able to pull dramatic form of return of investments from those tokens then I do believe this dynamic is going to continue and this dynamic is extremely bullish for the NEO cloud space.

So pretty pretty exciting here because I believe we're going to see this same trajectory across everybody else.