In today’s Cloud Wars AI Minute, I break down Nscale’s rapid shift from Bitcoin mining to AI data centers and why its enormous contracted backlog raises important questions about the risks and realities of scaling AI infrastructure.
Highlights
00:05 — So, one of the things that I wanted to bring up, because as I was doing my research, I ran across Nscale. Now, Nscale is probably the biggest company that none of you even know who they are, and it’s basically a data center hyperscaler.
01:48 — So, this company that literally has $103.4 billion in the ability for them to go and contract is only making $140.6 million as of H1 2026 revenue. So, that means they’re way off of their revenue targets against what they’re actually having to invest. If you take like 85% of what this company is funded by, it’s funded by Anthropic, which is about $44.6 billion, and Microsoft at $43.88 billion, and that’s primarily the workloads that they have, and that’s why their H1 net loss is about $1.02 billion.
03:03 — And they’ve got these hardware contracts to be able to go do it. But those contracts need hardware, and so it’s really interesting to see all the movement in this space. Because is this company overleveraged? We’re not quite sure.
03:21 — In the last 24 hours, we saw Microsoft walk away from a contract, and then Anthropic doubling down on a contract with this particular vendor. So, it’s going to become very interesting to see what happens as we watch this market expand, as the demand for data center capacity continues to grow, and companies like Nscale have the ability to sign these really big deals and these big contracts.
