Nvidia-backed Nscale, Anthropic in talks for new US$45 billion AI cloud deal, source says

Nvidia-backed Nscale is in discussions to enter into a new AI cloud computing deal with Anthropic, a potential transaction worth around US$45 billion, according to a source. Nscale, a data center developer, is seeking to secure a second facility at its Monarch data centre campus in West Virginia, a source said. In August, Anthropic had agreed to lease US$45 billion worth of AI cloud computing power from Nscale’s West Virginia data centre campus.

The forthcoming Monarch building would provide 460 megawatts of computing power utilizing Nvidia’s advanced Vera Rubin AI chips, as per the source. Anthropic holds a first right of refusal on Monarch’s anticipated third building, with ongoing discussions, and details might change. Bloomberg first reported the news, adding that a group of investors has urged Anthropic to reconsider its IPO valuation target following several setbacks within the AI industry.

Investors have intensified their scrutiny on companies embarking on debt-driven AI infrastructure expansion. Last week, Nscale's rival CoreWeave experienced a decline in its shares due to worries over its US$50 billion debt, leading to a global selloff in AI stocks. The potential partnership announcement arrives after Microsoft abandoned a plan to anchor a headline-making data center for Nscale, due to power connection delays that pushed its anticipated supply date into the 2030s.

Nscale has experienced rapid growth since its inception, with its total contracted value ballooning from US$100 million to over US$103 billion in just two-and-a-half years, and it is set to compete with other major players like Nebius, Crusoe, and Lambda. The Nscale prospectus indicates that Microsoft and Anthropic are projected to become the company's principal clients in the future.