Nvidia's $1.5 Billion Lambda Loop Looks A Lot Like CoreWeave 2.0

Core Insights - Nvidia Corp is renting its own chips for $1.5 billion from Lambda, a cloud startup it partly owns, mirroring a previous arrangement with CoreWeave before its IPO [1] - This strategy allows Nvidia to monetize its chips twice: first through sales and then through equity in startups, while also supporting its AI research [2] Business Strategy - By investing in startups like Lambda and CoreWeave, Nvidia is diversifying its customer base and creating future demand pipelines, which provides leverage against major competitors like Amazon Web Services and Google Cloud [3][4] - These startups serve as both customers and partners, helping Nvidia maintain its dominance in the rapidly growing AI chip market [4] Financial Transparency - The rental arrangement raises questions about the transparency of Nvidia's revenue, as it boosts the revenue of startups ahead of their IPOs [5] - Investors are uncertain whether the rental costs impact Nvidia's reported revenue, leading to concerns about the clarity of its financial strategies [6]