Analysis: If NVIDIA's new CEO tightens support for emerging cloud providers, it could accelerate customers' shift to AMD and Google's TPU

Citrini analyst Jukan wrote in a research note that NVIDIA’s GPUs remain in tight supply, but the company’s ability to sustain chip premium pricing and market leadership hinges on its ongoing support for emerging cloud service provider Neocloud. If the new CEO adopts a more cautious approach to financing and business support for such entities, it could lead to a drop in GPU spot prices, margin pressure on Neocloud, and in turn push these firms to switch to AMD or Google’s TPU ecosystem. Jukan views Neocloud as a critical link for NVIDIA to maintain chip order volumes and supply chain control. Once clients gradually reduce their reliance on NVIDIA, the company’s long-established commercial growth flywheel could be disrupted. He also noted that Jensen Huang previously actively pushed NVIDIA chips into the Chinese market, and sought to maintain Chinese AI developers’ reliance on NVIDIA’s ecosystem via overseas Neocloud leasing channels, to secure corresponding computing power demand and Neocloud utilization rates. However, these moves have crossed into the gray area of U.S. policies, carrying political and regulatory risks. Jensen Huang originally aimed to continue bearing part of the financing risks for clients until Neocloud is capable of independently procuring next-generation GPUs, but it remains unclear whether the new CEO will continue this strategy. He expressed concerns about NVIDIA operating without Jensen Huang at the helm.