Analyst: Concerns that Nvidia's Interim CEO May Not Adequately Support Neoclouds, Potentially Weakening the Company's Growth Flywheel

Odaily: Analyst Jukan posted on X that Nvidia chips remain in short supply, but to sustain the scarcity premium, the company needs to continue supporting emerging cloud service providers (Neoclouds). If the new CEO takes a more cautious approach to this business model, it could put pressure on GPU spot prices, reduce cloud service providers' profit margins, and push them to turn to alternatives such as AMD or Google TPU, thereby weakening Nvidia's market dominance and supply chain control.

Jensen Huang has been working hard to maintain Nvidia's growth flywheel, which not only helps expand chip demand but also ensures compute utilization for emerging cloud service providers. He reportedly hoped to gradually step back once Neoclouds were able to independently order next-generation GPUs, but it remains uncertain whether the successor CEO is willing to wait. According to The Wall Street Journal, the current CEO appears to lack such patience.

Previously, Nvidia (NVDA.O) interim CEO and Chief Financial Officer Colette Kress had repeatedly raised objections to high-risk deals pushed by Jensen Huang. People familiar with the matter said Kress may adopt a more prudent operating strategy than Huang. She had previously opposed Nvidia's plan to provide up to $250 billion in credit support to OpenAI; the deal was ultimately split, and Nvidia currently only committed to providing about $100 billion in credit support. With data center projects delayed and cloud computing deals canceled, Kress had already begun diversifying Nvidia's financial risk exposure to a small number of customers.