Nvidia faces neocloud shakeout risk with 45% data center revenue at stake
nvidia's data center revenue is 45% dependent on neoclouds, which are expected to consolidate, and only 7-10 providers may survive in a few years.
a shakeout is expected among up-and-coming ai cloud providers, known as neoclouds, with hundreds of providers rushing into the market. industry executives expect only 7-10 of them to still be around in a few years. nvidia has a significant stake in the outcome, with 45% of its data center revenue, or $40 billion in the july quarter, coming from customers outside big tech companies. the chipmaker is propping up the industry with equity investments, chip allocations, loan guarantees, and customer leads. analysts predict that 80% of independent neoclouds will cease operations by 2030.