Nvidia's customer concentration went from 0% to 61% in four years, right as it agreed to insure 25% of its own customers' loans. Breaking down what the filings and credit markets actually show.

Been digging into the Nvidia $500B financing deal from a couple weeks back and the numbers underneath it are wilder than the headline. Posting the actual sourcing here, full piece with charts is linked at the bottom for anyone who wants the long version. **The deal itself** On Aug 10, Nvidia lined up Apollo, BlackRock, Blackstone, Brookfield, Goldman, and KKR to raise $500B so its own customers can afford more of its chips. Nvidia backstops up to 25% of the loss if the GPUs used as collateral don't hold resale value. Larry Fink called it "the next future of financial engineering" on CNBC that day. Same phrase people use for mortgage-backed securities. Nvidia's customer concentration by fiscal year, straight from the filings: * FY2022: 0 customers above 10% of revenue * FY2023: 0 customers above 10% of revenue * FY2024: 1 customer, 13% * FY2025: 3 customers, \~36% combined * FY2026: 4 customers, 61% combined (22/15/13/11) Zero to 61% in four years. And per the 10-Q, 3 of those 4 customers (Google, Amazon, Meta) are actively building their own chips (TPU, Trainium, MTIA) specifically to need Nvidia less. So the collateral behind a $500B insured financing deal is concentrated in a shrinking number of customers, several of whom are actively trying to exit the relationship. **The 1999 comparison that actually holds up** Telecom equipment makers in the late 90s didn't just sell gear, they financed the customers buying it, then booked the financing as revenue. Nortel's financing terms once hit 130% of the purchase price. The revenue looked real until it didn't. Nvidia's version is more careful, it's routing risk to Wall Street instead of its own balance sheet, and only covering 25% instead of 100%. But you don't build a 25% backstop for a trade you're sure can't lose. **Credit markets are already pricing this** * CoreWeave (65% of revenue from just Microsoft + OpenAI): CDS priced at roughly a coin-flip chance of default in 5 years * Oracle: CDS at a multi-year high, now used informally as a proxy for how worried the market is about the whole AI financing chain * Banks have reportedly started refusing new loans on Oracle projects tied to OpenAI exposure None of this has hit equity yet, Nvidia's near its high. Bond and equity markets are pricing the same handful of companies like two different industries right now. **Not saying this proves a bubble.** The underlying demand for compute is real, Nvidia's CUDA moat is real. The question is narrower: what does a financing structure like this tell you about what the people closest to the money actually expect, versus what they say on earnings calls. Full piece with sourcing, charts, and the Nortel comparison in more depth: [https://manasbihani.substack.com/p/aaa-rated-gpus?r=1z7d38](https://manasbihani.substack.com/p/aaa-rated-gpus?r=1z7d38) Happy to argue about any of this in the comments, especially if you think the credit market read is wrong.