Nvidia Invests an Additional $2 Billion in CoreWeave
Speakers
Ed Ludlow
— Co-Host, Bloomberg Technology
Summary
Nvidia is investing an additional $2 billion in CoreWeave at $87.20 per share to support CoreWeave's AI data-center capacity buildout. Nvidia CEO Jensen Huang defended the deal against circular-financing concerns, saying CoreWeave is not required to use Nvidia chips and the investment is small relative to CoreWeave's future funding needs. CoreWeave shares rose more than 9% premarket, while Nvidia's new standalone CPU offering, first deployed by CoreWeave, pressured AMD and Intel.
- Nvidia will buy $2 billion of CoreWeave stock at $87.20 per share.
- CoreWeave plans to add more than 5 gigawatts of AI computing capacity by 2030.
- Jensen Huang rejected circular-financing criticism of the investment.
- CoreWeave was first to deploy Nvidia's standalone CPU offering.
- AMD and Intel shares came under premarket pressure on the CPU news.
- CoreWeave shares jumped more than 9% in premarket trading.
Ideas
Nvidia backing supports CoreWeave capacity growth.
Nvidia is investing an additional $2 billion in CoreWeave at $87.20 per share, signaling confidence in CoreWeave's management and its plan to accelerate data-center capacity to meet existing AI demand. CoreWeave is also first to deploy Nvidia's new standalone CPU offering, and the stock jumped more than 9% premarket, supporting a bullish view despite circular-financing criticism.
Circular financing fears overdone for Nvidia.
Nvidia's additional $2 billion investment in CoreWeave should not be viewed as circular financing because CoreWeave can take Nvidia's money without being required to use Nvidia chips, and the investment is a tiny portion of what CoreWeave will need to raise. Nvidia says the deal is consistent with its investments across the AI stack, rebutting a key bear case.
