Why Compute Needs a Big Down Payment

The Information: due to AI infrastructure shortages, cloud providers are demanding large prepayments and long-term contracts. Nebius expects over $9 billion in prepayments for the year with revenue up to $3.4 billion, while Iren receives up to 55% of GPU cost upfront. Coatue is discussing a multibillion-dollar joint venture with chip startup MatX.

• Nebius: about 70% of new deals in Q2 require prepayment
• Nebius expects over $9 billion in prepayments with revenue up to $3.4 billion
• Iren: clients pay up to 55% of GPU and equipment cost upfront
• Coatue discusses joint venture with MatX to reserve fab capacity