Nebius rises from Yandex’s ashes to lead Israel’s supercomputing project
With roots in Russia and a base in Amsterdam, the AI upstart wins a critical national contract.
The Israel Innovation Authority’s selection of Nebius to build Israel’s national AI supercomputer is an unusual move. Nebius is not one of the industry’s well-known giants but rather a relatively young company with complex origins.
Officially, Nebius is a European firm registered in the Netherlands and headquartered in Amsterdam. It began trading on Nasdaq just six months ago, with a market capitalization of $8.3 billion. Its annual revenues are under $200 million, and the company is not yet profitable.
But that’s only part of the story. In reality, Nebius is what remains of Yandex—the so-called “Russian Google” that once dominated Russia’s internet and computing sectors. At the end of 2024, Nebius returned to the Nasdaq after Yandex was suspended when sanctions were imposed on Russian companies following the invasion of Ukraine.
Nebius was originally established in 1989 as the holding company through which Arkady Volozh, Yandex’s co-founder, held his stake. Volozh immigrated to Israel before the COVID-19 pandemic and became a citizen. Although he built his wealth in post-Soviet Russia in the late 1990s, he has long stood apart from the archetype of the Kremlin-aligned oligarch. Together with his Jewish partner Ilya Segalovich, who passed away years ago, Volozh built a tech empire that at its peak was worth $30 billion and listed on Nasdaq.
Even before the war in Ukraine, tensions had emerged between Volozh and the Putin regime, which sought greater control over Yandex, particularly its news platforms and user data, including data from Yango, the ride-hailing service it operates in Israel. During Yandex’s heyday as a darling of Wall Street, it ran autonomous vehicle trials in Israel and launched the Yango Deli delivery service.
Following the imposition of sanctions and after Volozh publicly condemned Russia’s invasion, the Kremlin attempted to seize control of Yandex. In a rare deviation from typical Russian state behavior, a compromise was reached: Volozh would divest entirely from the Russian business, which would continue operating under the Yandex brand, while he retained the cloud and data center operations under a new name, Nebius.
Roughly a year ago, a consortium of Kremlin-linked investors paid $2.4 billion for Yandex’s Russian assets. Today, Volozh serves as CEO of Nebius and is well capitalized. At the time of the corporate split, he pledged that Nebius would invest $1 billion in AI and cloud infrastructure to gain market share.
In the past year, Nebius has spent hundreds of millions of dollars building data centers in Finland, France, and the United States. However, until now, it had not secured any major public contracts on the scale of Israel’s national supercomputer. Still, the company is receiving growing validation within the tech sector. Before its return to the Nasdaq, Nvidia joined a $700 million private investment round in Nebius. Just last week, Jeff Bezos invested in Toloka, its AI-focused subsidiary.
