The list of circular AI deals gets another entry:
Nvidia invested $2 billion into Nebius, a company that used to be called Yandex (the Google of Russia). Nebius listed on Nasdaq in 2024 as an AI infrastructure company, operating as a neocloud: a data center business built specifically for AI workloads, entirely around Nvidia's hardware. Not a general-purpose cloud like AWS or Google. Just AI all day, every day.
Breaking down the buzz:
The $2 billion gets Nvidia an 8.3% stake in Nebius, but the money is almost secondary. As part of the deal, Nebius gets early access to Nvidia's next-generation Rubin GPUs and Vera CPUs, hardware that isn't available to anyone yet. In the neocloud business, having newer chips before your competitors do is a direct advantage. In exchange, Nebius commits to deploying more than 5 GW of Nvidia-powered compute capacity by the end of 2030, similar to the deal with CoreWeave.
This is not Nvidia's first move into Nebius either. In December 2024, Nvidia participated in a $700 million funding round in Nebius and took a board seat. Nvidia has been writing a lot of these cheques lately:
invested $2 billion into CoreWeave
invested $30 billion into OpenAI
invested $2 billion into Lumentum
invested $2 billion into Coherent
participated in the $2 billion Series C at Nscale
Why this matters:
Nvidia invests in companies that then use the money to buy Nvidia chips. These neoclouds exist because Nvidia wants them to, and it uses them as distribution channels. With Lumentum and Coherent, Nvidia is securing future capacity in the lasers and silicon photonics that its next-generation AI data centres will depend on.
If enterprises keep spending on AI at this pace, Nvidia's investments lock in its dominance for a decade. Nvidia is no longer just the company that makes the picks and shovels for the AI gold rush. It's becoming the financier of the mines too.
Copy my portfolio for steady and consistent growth, $NVDA (NVIDIA Corporation)... Show More
Not investment advice. The author may have financial interests in the mentioned instruments.
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