Key Points
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Nebius outpaced neocloud rivals with 454% Q2 revenue growth, but its 46 price-to-sales ratio makes it the most expensive.
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CoreWeave’s cheaper valuation, at about 6 times sales, reflects heavy debt, even as its revenue growth outpaces that of the three biggest cloud providers.
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AppLovin and Robinhood fund growth via profits and platform cash, while IREN relies on external capital to ramp up its AI cloud business.
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Fast growth is easy to love and hard to value, as CoreWeave (NASDAQ: CRWV) recently showed. On Oct. 14, 2026, the stock plunged 15% even as its revenue more than doubled, with investors worried about rising debt costs.
Here’s what investors are paying for growth at five fast-growing companies, ranked by the latest quarter’s revenue growth: Nebius Group (NASDAQ: NBIS), CoreWeave, AppLovin (NASDAQ: APP), Robinhood Markets (NASDAQ: HOOD), and IREN (NASDAQ: IREN).
Let’s start with the fastest of the bunch.
Nebius tops its AI cloud peers, but investors pay a premium
In the second quarter, revenue jumped 454% year over year to $582.3 million, outpacing neocloud rivals like Applied Digital, up 322%, and CoreWeave, up 112.5%. Nebius secured major AI cloud contracts, including agreements worth more than $1 billion each, while management has been expanding compute capacity to meet demand.
But with a price-to-sales ratio (P/S) of about 46, the highest of the five, investors are paying a hefty premium for that growth, which is largely funded by cash, customer prepayments, and outside financing.
Today’s premium also rests on a long runway: management expects 5 gigawatts of contracted power by year-end and plans to add more than 1 gigawatt a year from 2027.
Nebius also faces risks around customer concentration and execution. Meanwhile, a similar company is growing fast at a more reasonable valuation.
Big AI contracts power CoreWeave’s growth, but debt is a worry
CoreWeave’s revenue jumped 112.5% year over year to around $2.6 billion, outpacing Google Cloud, Azure, and AWS in the same quarter. The company also reported a revenue backlog of $104 billion, and management is guiding to revenue between $12.4 and $13.2 billion this year.
The stock also trades at just 6.0 times sales, making it relatively cheaper despite its growth. But the major concern is funding: with $640 million in net interest expense, its growth relies heavily on debt, making its build-out riskier to fund.
However, unlike these high-growth neoclouds, another company is already seeing better profitability.
AppLovin’s AI-driven ad business is growing and profitable
The combination of strong sales growth and profitability sets AppLovin apart from the more capital-intensive AI names.
Revenue rose 53% year over year to $1.9 billion in the second quarter, well ahead of ad-tech peer The Trade Desk, up 3%. Notably, the growth is funded by profits and cash generated by the business.
That said, at about 16 times sales, AppLovin trades at a premium to many traditional advertising businesses, and for good reason. Its runway includes e-commerce, where ad tools are now open to all merchants.
That said, the company faces risks around competition with larger tech platforms and potential changes to app store policies.
On a different note, one company is building a high-growth financial platform beyond AI.
A broker growing into a financial platform beyond stock trading
Robinhood’s second-quarter revenue rose 32% year over year to a record $1.3 billion, ahead of brokerage peers Interactive Brokers, up 28%, and Charles Schwab, up 21%. The growth is supported by expansion into retirement accounts, subscriptions, credit cards, and prediction markets.
But at about 23 times sales, investors are paying a premium for Robinhood’s customer growth and product expansion, funded by cash generated by its platform. Still, the risk is that trading activity can fall sharply when markets cool, while new products face stiff competition.
Last on the list is a company running the physical infrastructure behind the AI build-out, though its total revenue is shrinking.
IREN’s AI cloud is growing fast while total revenue falls
Total revenue fell 26.7% year over year to $137.2 million in the June quarter, driven by a decline in Bitcoin mining revenue. AI cloud revenue was a different picture, rising about tenfold to $70.5 million, faster than cloud growth at Nebius or CoreWeave, though from a much smaller base.
At about 19 times sales, today’s investors are paying for the shift to AI cloud rather than for current revenue growth, with the build-out funded by debt and equity.
Granted, the runway is long, with $4 billion in contracted annualized revenue for 2026 capacity, though only about $1 billion is operating today. Still, the company must manage execution risk as it raises capital to scale its business.
These five demonstrate that growth comes with very different valuations and funding needs.
Which growth stocks are worth the price?
Among these growth stocks, AppLovin could be the safest option because its growth is funded by profits, followed by Robinhood, whose cash-funded expansion still depends on trading activity. CoreWeave sits in the middle, while Nebius and IREN are the higher-risk, higher-reward picks.
Ultimately, the best opportunity isn’t necessarily the fastest-growing stock, but the one that can generate sustainable profits without asking investors to pay too much.
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Charles Schwab is an advertising partner of Motley Fool Money. Rick Orford has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin, Interactive Brokers Group, and The Trade Desk. The Motley Fool recommends Charles Schwab and Robinhood Markets and recommends the following options: long January 2027 $43.75 calls on Interactive Brokers Group, short January 2027 $46.25 calls on Interactive Brokers Group, and short September 2026 $95 calls on Charles Schwab. The Motley Fool has a disclosure policy.
