In this deep dive, Zaid breaks down how neoclouds work, what sparked the comeback and why their enormous debt and borrowing costs could become a serious problem. Plus, can these companies build a lasting advantage, or are they simply benefiting from a temporary shortage that Amazon, Microsoft and Google will eventually solve?

Deep Dive: CoreWeave and Nebius Are Roaring Back. Can It Last?

The Rundown

Welcome back to The Rundown for another Weekend Deep Dive. Today, we are talking about the hottest trade on Wall Street right now, NeoCloud stocks. This week, CoreWeave's stock jumped nearly 20% in a single day. Nebius' stock was up over 30% in a single day. These stocks have been on an absolute tear. And this is coming just weeks after this whole sector was left for dead back in July. So in today's episode, we'll break down what Neocloud companies actually do, their business

model, why Wall Street suddenly fell back in love with these stocks, and the risk these companies face moving forward. We got a great one for you today. Let's dive in. Before we talk about why these stocks are ripping, I want to first explain what a Neocloud company actually does. A Neocloud is a cloud computing company built specifically for AI. These companies buy a ton of AI chips, mostly from NVIDIA, put these chips inside data centers, and then rent

access that computing power to whoever needs it. The customers for these companies include AI labs like OpenAI and Anthropic, and even existing hyperscalers like Microsoft. And what makes these NeoClouds different from traditional cloud providers like Amazon Web Services or Microsoft Azure or Google Cloud is that they are built almost entirely around AI. Traditional cloud platforms were designed to handle almost every kind of computing job imaginable. Think websites and databases

and storage and cybersecurity and corporate software. But Neoclouds primarily focus on AI and other GPU intensive workloads. And that allows these companies to offer faster access and simpler pricing and more flexible contracts than the traditional cloud giants.

Deep Dive: CoreWeave and Nebius Are Roaring Back. Can It Last?

Read the full transcript

The candid version is on a podcast,
not the earnings call.

Deep Dive: CoreWeave and Nebius Are Roaring Back. Can It Last?

Read the full transcript

The candid version is on a podcast, not the earnings call.

The candid version is on a podcast,
not the earnings call.