Nebius plans $40 billion spending despite project delays

Ambitious spending faces schedule cracks

The company intends to fund this buildout through customer pre-payments and loans backed by contracts. CEO Arkady Volozh stated that building at this scale is difficult and delays are part of the industry. One major project in Vineland, New Jersey, is now months behind schedule due to issues with temporary generation. Only just over half of the Microsoft capacity is planned for delivery by the end of the year.

Regulatory fines and third party issues

DataOne faces a $1.1 million fine from New Jersey regulators for operating unpermitted natural gas generators. An investigative site identified at least 45 such generators even though no permits existed for their operation. The facility also deals with a noise-complaint lawsuit from nearby residents over constant humming sounds. If scheduled dates are missed without providing an alternative capacity, Microsoft will end the impacted service.

Microsoft tightens oversight on partners

According to Bloomberg, Microsoft has increased supervision over initiatives managed by external groups such as Nebius and IREN. The tech giant sent employees to the New Jersey site to review operations directly. Microsoft noted in its own quarterly earnings report that capex spend was lower than expected due to these delays. TechCrunch contacted Nebius, Microsoft, and DataOne seeking their comments regarding the matter.