It’s amazing that Elon can warn that Neo-Clouds are going to start failing and everyone posts it as great news for $CRWV $NBIS and $IREN
Just last week he blasted Neo-Clouds for being unable to efficiently and profitably deploy compute.
Just last week he blasted Neo-Clouds for being unable to efficiently and profitably deploy compute.
@Yuchenj_UW I think we’re going to see a lot of stranded compute in partially complete data centers
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Roger retweeted
"Licking My Wounds": Goldman's Pasquariello Swims Closer To Shore After AI Selloff "Cut Into Some Bone" zerohedge.com/markets/lickin…
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I’m not a lawyer, but my presumption is that a major reason $NVDA won’t bailout $CRWV by backing the companies debt is because $NVDA essentially used Coreweave as a channel stuffing entity and ammended the terms of $6 billion of chip obligations to appear as a “near term liability” on Coreweave balance sheet (to date) that CoreWeave can’t pay unless they find financing.
A company having near term liabilities equal to 100% annual revenue and 1/3 of marketcap is insane outside of bankruptcy.
If $NVDA backed the debt after ammending the terms of the obligations in the contract for delivery of chips, it would put Nvidia executives in a very similar situation Bernie Madoff was in. A later Goodwill writeoff when CoreWeave defaults is a much better outcome than prison for attempting to coverup problems already known on ammended contract terms that would have defaulted otherwise.
This is speculation on my part, since there’s no way to know Nvidia’s intent of accumulating “Near term liabilities” on Coreweaves balance sheet.
A company having near term liabilities equal to 100% annual revenue and 1/3 of marketcap is insane outside of bankruptcy.
If $NVDA backed the debt after ammending the terms of the obligations in the contract for delivery of chips, it would put Nvidia executives in a very similar situation Bernie Madoff was in. A later Goodwill writeoff when CoreWeave defaults is a much better outcome than prison for attempting to coverup problems already known on ammended contract terms that would have defaulted otherwise.
This is speculation on my part, since there’s no way to know Nvidia’s intent of accumulating “Near term liabilities” on Coreweaves balance sheet.
Imagine a company not already being bankrupt while having near time liabilities “accounts payable” piling up to 1/3 of the companies entire marketcap and equal to an entire years revenue. That is how delusional the Ai bubble is. $NVDA is basically hiding channel stuffing as undisclosed terms “accounts payable”agreements with buyers to hide the buyer has essentially defaulted on a contract; while simultaneously hoping a bubble continues so some idiot lender will give the defaulted entity money to repay $NVDA.
Thats $CRWV
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It’s actually REALLY embarrassing analysts are spewing bullshit about $CRWV and someone with 399 followers has a more solid grasp of the dire situation CoreWeave is in (and how it’s consequently related to $NVDA hiding channel stuffing as “accounts payable” on Neo-Cloud balance sheets.
@rdd147 $CRWV never made a single dime of net income on a cumulative basis. Because of the accumulated deficit , shareholders' equity is almost cut in half.
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Imagine a company not already being bankrupt while having near time liabilities “accounts payable” piling up to 1/3 of the companies entire marketcap and equal to an entire years revenue. That is how delusional the Ai bubble is. $NVDA is basically hiding channel stuffing as undisclosed terms “accounts payable”agreements with buyers to hide the buyer has essentially defaulted on a contract; while simultaneously hoping a bubble continues so some idiot lender will give the defaulted entity money to repay $NVDA.
Thats $CRWV
Thats $CRWV
I want to be fair to $NBIS but more importantly show how close $CRWV may really be to default. The hallmark of near term default risk is hiding cash flow problems and losses as liabilities.
Since $NBIS is nowhere near the default risk of $CRWV they don’t have “accrued expenses” combine “accrued expenses” and “accounts payable”
For CoreWeave “Accrued Expenses” is money they owe to hardware suppliers for obligations they made that they are now struggling to make good on. (Although it’s impossible for us to know how the suppliers are working with CoreWeave on re-payment terms, could be 6 months or 5 years if $NVDA wants to keep hiding channel stuffing).
I’m not a fan of any Neo-Cloud over the next 3-5 years, so this isn’t an endorsement of $NBIS necessarily. $CRWV will be lucky if they ever see 2028.
CoreWeave facing typical near term bankruptcy
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I want to be fair to $NBIS but more importantly show how close $CRWV may really be to default. The hallmark of near term default risk is hiding cash flow problems and losses as liabilities.
Since $NBIS is nowhere near the default risk of $CRWV they don’t have “accrued expenses” combine “accrued expenses” and “accounts payable”
For CoreWeave “Accrued Expenses” is money they owe to hardware suppliers for obligations they made that they are now struggling to make good on. (Although it’s impossible for us to know how the suppliers are working with CoreWeave on re-payment terms, could be 6 months or 5 years if $NVDA wants to keep hiding channel stuffing).
I’m not a fan of any Neo-Cloud over the next 3-5 years, so this isn’t an endorsement of $NBIS necessarily. $CRWV will be lucky if they ever see 2028.
CoreWeave facing typical near term bankruptcy
Since $NBIS is nowhere near the default risk of $CRWV they don’t have “accrued expenses” combine “accrued expenses” and “accounts payable”
For CoreWeave “Accrued Expenses” is money they owe to hardware suppliers for obligations they made that they are now struggling to make good on. (Although it’s impossible for us to know how the suppliers are working with CoreWeave on re-payment terms, could be 6 months or 5 years if $NVDA wants to keep hiding channel stuffing).
I’m not a fan of any Neo-Cloud over the next 3-5 years, so this isn’t an endorsement of $NBIS necessarily. $CRWV will be lucky if they ever see 2028.
CoreWeave facing typical near term bankruptcy
One of the ways we look at default risk in bonds is to investigate accounts payable vs receivable and accrued expenses.
Two red flags are falling accounts receivable with rising accounts payable as well as increasing accrued expenses.
People overlook the numbers, but it shows to hide cash flow and losses on their balance sheet as liabilities.
For $CRWV trending toward what you see in defaults; especially accrued expenses. You can see the cash they’re raising through bonds, share sales, and convertibles isn’t for debt or expansion, it’s for paying down major past due bills that are piling up that haven’t been paid.
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