Nvidia, CoreWeave, and Nebius: Inside the Circular Financing of the GPU Boom
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Nvidia-backed neoclouds like CoreWeave and Nebius have secured over $120B in hyperscaler commitments but rely on circular financing and GPU-backed debt to fund buildouts, exposing fragility in their cash flow and profitability. This means production ML teams must plan for potential supply chain disruptions or cost spikes if these financing structures unravel, as their GPU capacity depends on these leveraged players.
Neoclouds like CoreWeave and Nebius are fueling their massive buildouts on up to $122 billion in long-term commitments from Microsoft and Meta, using circular financing structures, Nvidia equity investments, and GPU-backed debt to offset their lack of organic cash flow. This fragile financial leverage means your underlying GPU capacity pricing and availability are highly dependent on these neoclouds successfully converting massive backlogs and 7 gigawatts of contracted power into active data centers. If their high debt loads or precarious financing structures buckle under macroeconomic pressure, production workloads relying on these alternative clouds face severe capacity-disruption and pricing-volability risks.