CoreWeave may have built a house of (graphics) cards CoreWeave this week said it would plow between $20 and $23 billion into GPU bit barns by year's end in order to meet growing demand from model builders and hyperscalers. Those figures, along with new commitments from OpenAI and yet unnamed hyperscale customers, were no doubt intended to instill confidence in the rent-a-GPU …
Microsoft will be spending a lot less in 2025. Most of their spend was in support of OpenAI, with whom they used to have an exclusive contract to provide GPU capacity. But recently they agreed to allow OpenAI to get its GPU-hours elsewhere (hence OpenAI's involvement in Stargate.) So that $11B revenue from OpenAI is probably just replacing the same revenue that used to come from Microsoft to support OpenAI.
It's also an open question where OpenAI will get the money, since it is losing billions every year (with no near-term path to profitability). It was supposed to get $20B from SoftBank, which doesn't have the money either and needs to find willing lenders to back its bet on OpenAI. And even then, the deal is dependent on OpenAI restructuring as a for-profit entity, which is proving trickier than expected. What happens if Softbank can't keep up its end?
If the first domino falls, the rest will come down like a house of cards. Checkmate.
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