CoreWeave shares rose by almost 6 percent on Monday following a declaration by Nvidia that it has invested up to $2 billion in the artificial intelligence infrastructure provider.
According to a release, Nvidia acquired CoreWeave Class A common stock at $87.20 per share, a discount from Friday’s closing price of $92.98. The companies reported that the investment will assist CoreWeave to hasten the construction of “5 gigawatts of AI factories by 2030.”
CoreWeave CEO Mike Intrator informed CNBC’s “Squawk on the Street” on Monday, “This deal allows us to accelerate our build, which will lead to continued diversification and reducing dependency on any particular client as we scale into this additional data center capacity.”
A gigawatt is a unit of power that is becoming a more frequent unit of description of AI data center capacity. According to a CNBC analysis of data from the Energy Information Administration, a five-gigawatt equals approximately the annual electricity use of 4 million households in the U.S.
Nvidia CEO Jensen Huang told CNBC during the interview, “The thing to remember is we’ve invested $2 billion into CoreWeave, but recognize that the amount of funding that needs to be raised yet to support that five gigawatts is really quite significant. We’re investing a small percentage of the amount that ultimately has to go and be provided.”
CoreWeave currently generates revenue by constructing and renting out data centers packed with the graphics processing units developed by Nvidia, which are central to model training, as well as to running large AI workloads.
The firm, which has been categorized by some shareholders as a neocloud, has evolved to be a key participant in a more integrated web of AI infrastructure partners. Nvidia was already a large CoreWeave supporter before the announcement on Monday.
