Investor links Huang's departure from Nvidia to risks for AI compute rental services

Nvidia announced a leadership change after Huang admitted to an extramarital affair with a woman whom U.S. intelligence agencies consider a Chinese spy. The board of directors conducted an investigation into this matter. Chief Financial Officer Colette Kress has become the interim CEO, and Harvey Jones was appointed as the chairman of the board.

Neoclouds—such as CoreWeave, Nebius, and other companies—purchase chips from Nvidia, deploy them in data centers, and lease computational power to AI labs and other clients. Nvidia also invests in such companies and supports their financing: in July, it offered to rent unused capacities from partners at a fixed rate, and through a separate financial platform, it can provide up to $125 billion.

According to Kaiser's assessment, it is this support, rather than the chips themselves, that helps neoclouds attract large loans. As of the end of June, CoreWeave's debt amounted to $35 billion. If creditors decide that Nvidia's guarantees are now less reliable, the cost of financing may rise, and the business of such companies could come under pressure.

Following Huang's departure, CoreWeave's shares dropped by 9%, and Nebius's by 16%. Kaiser believes that Nvidia will maintain a strong position in AI model training for another two to three years: clients will find it difficult to abandon the CUDA software platform. The main battle, in his opinion, will unfold in inference—the deployment of already trained models—where buyers compare Nvidia's universal solutions with cheaper specialized chips.