Sergey

Sea Limited Q3 2025 Earnings & CoreWeave, Nebius Snapshot $SE, $CRWV, $NBIS Earnings analysis with review of financial performance, key metrics, operating expenses, dilution, customer growth, future outlook

Full Earnings Analysis: sergeycyw.substack.com/p/sea-limit...

Future Outlook: ARR forecast $7–$9B by end-2026, over half already contracted. Pipeline +70% QoQ with $4B new opportunities. Financing to mix debt, asset-backed facilities, and limited 25M-share ATM equity program. Management sees AI infrastructure demand as structural and durable.

Hardware and Demand Outlook: Demand for Hopper and Blackwell GPUs remains extreme. All Q4 capacity sold, future quarters pre-sold. Capacity, not GPUs, remains the bottleneck through 2026.

Challenges: Expansion constrained by power, permitting, and GPU supply. Despite this, power commitments rose from 1 GW to 2.5 GW in one quarter—strong progress amid tight supply.

Margin Dip: Core infra margin 19%, but overall profit softened by scale-up costs and slower ARR from timing. Margins to recover as utilization rises.

Regional Progress: Sites in Israel, U.K., New Jersey, and Finland launched or expanded with near-full utilization. Finland to deploy GB300 GPUs by Q4, first in Europe. Demand absorption remains rapid across regions.

Infrastructure Partnerships: Long-term contracts anchor revenue. Microsoft deal ramps 2026–27, full recognition by 2027. Meta’s $3B contract constrained only by capacity. These secure financing and utilization visibility.

CapEx Philosophy: Three-phase model: 1% land/power, 18–20% construction, 80% GPUs. Focus on over-securing power and aligning GPU spend with demand. 2025 CapEx raised to $5B from $2B to accelerate readiness.

Product Innovations: Aether 3.0 enables enterprise-grade AI management; Token Factory converts GPU capacity into high-throughput inference with guaranteed performance. Both enhance integration and recurring utilization.

AI Cloud Platform: Launched Aether 3.0, an enterprise AI platform with compliance, IAM, and monitoring. Introduced Nebius Token Factory, offering inference-as-a-service for Llama, Qwen, DeepSeek, Nematron with 99.9% uptime and fixed pricing. Expands reach to ISVs and enterprises.

Major deals: Microsoft $17.4–$19.4B and Meta $3B. Scaling limited by power and equipment constraints.

AI Infrastructure: Capacity remains fully sold out. Contracted power target raised to 2.5 GW (from 1 GW); connected power to reach 800 MW–1 GW. New sites in Israel, U.K., Finland, and New Jersey launched pre-sold. CapEx split: 1% land/power, 18–20% build, 80% GPUs.

FY25 guidance narrowed to $500–$550M, ARR target $900M–$1.1B. Incremental ARR slowed to $12M due to capacity limits, not demand. Adjusted EBITDA expected slightly positive by year-end.

Key points from #NBIS #Nebius’s Third Quarter 2025 Earnings Call:

Financial Performance: Q3 revenue reached $146M, up 355% YoY and 39% QoQ, led by AI infrastructure (90% of total). EBITDA margin improved to 19%, and ARR exited at $551M.

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• Dilution: shares outstanding +26.3% YoY to 251.8M;
• Constraints: power, MEP equipment, permitting; supply-demand imbalance likely through 2026

• Q3 miss vs est.: revenue $146.1M (est. $151–156M); Adj. net loss ($100.4M) vs est. ($95.7M)
• Operating income ($130.2M); operating margin -89%; net income ($119.6M); EPS ($0.40)
• Incremental ARR $12M vs $180M prior quarter (capacity-limited)
• High spend: Q3 capex ($955.5M);

• Capex accelerated to $5B (from $2B) to pull forward power, shells, hardware
• Regional: Israel (B200) live and sold out; U.K. (B300) near full at launch; Finland adding GB300 by year-end; New Jersey tranche delivered

🔴 Negative

• Product: launch of Aether 3.0 (enterprise compliance) and Token Factory (inference, 99.9% uptime)
• Liquidity: cash & restricted cash $4.92B

🟡 Neutral
• FY25 revenue guide tightened to $500–$550M (capacity timing); pipeline +70% QoQ to $4B

• ARR outlook $7–$9B by end-2026; end-2025 ARR $900M–$1.1B reaffirmed; exit-September ARR $551M
• Mega-deals: Microsoft $17.4–$19.4B; new Meta ~$3B/5yrs; capacity sold out in Q3; Q4 nearly sold
• Capacity plan raised: contracted power 2.5GW (from 1GW); connected power 800MW–1GW by end-2026

Thoughts on #Nebius Earnings Report #NBIS:
🟢 Positive
• Revenue $146.1M (+355% YoY, +39% QoQ); core AI infrastructure ~400% YoY, ~40% QoQ; gross profit $103.2M, 71% margin (+1.5pp YoY)
• Adj. EBITDA ($5.2M); margin -4% (+139.4pp YoY); path to slightly positive YE

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• Near-term margin headwinds in e-commerce from fulfillment build-out and VIP incentives

• EPS $0.59, missed by −38.5%
• Logistics drag: Value-added services revenue $0.7B (−6% YoY) from higher shipping subsidies
• Segment pressure: Digital Financial Operating margin 25.1% (−3.2 pp YoY); Digital Entertainment 47.4% (−5.3 pp YoY); Other Services −55.8% (−20.4 pp YoY)

• Capital-light execution: fulfillment scaling via leasing; Shopee VIP 3.5M (+75% QoQ); ShopeePay app active in 4 markets (~20% of users)
• International: Brazil delivery sped up by ~2 days; São Paulo 1/3 next-day; re-entered Argentina; exited Chile/Colombia

🔴 Negative

• Mix steady: E-commerce 71.7%, Digital Financial 16.8%, Digital Entertainment 10.6%, Other 0.9%
• Commerce activity: E-commerce orders 3,600M (+9.1% YoY); user base: QAUs 671 (+6.7% YoY), QPUs 66 (+31.0% YoY)

• SeaMoney: $989.9M (+60.8% YoY) revenue; stable NPL 1.1%; loan book $7.9B (+70% YoY); 5M new borrowers
• Opex discipline: S&M/Rev 19.2% (-1.1 pp), R&D/Rev 4.8% (-2.2 pp), G&A/Rev 5.7% (-1.4 pp); SBC/Rev 3% (-0.5 pp QoQ)

🟡 Neutral

• E-commerce: $4,294.8M (+34.9% YoY, 71.7% of rev), Operating margin 2.6% (+3.7 pp); GMV $32.2B (+28.3% YoY)
• Garena: Bookings $841M (+51.1% YoY); strong IP events; Digital Entertainment revenue $653.0M (+31.2% YoY)

Thoughts on #SeaLimited Earnings Report #SE:
🟢 Positive
• Revenue $5,986M (+38.3% YoY, +13.8% QoQ), beat by +6.4%; Adjusted EBITDA $874M (+68% YoY); Net income $375M
• Margin expansion: GM 43.4% (+0.4 pp), Operating margin 8.0% (+3.3 pp), OCF margin 31.4% (+2.2 pp), Net margin 6.3% (+2.7 pp)

Growth, margin expansion, and capacity visibility show strong momentum—even as profitability lags behind investor expectations.