Google is in negotiations with CoreWeave to rent Nvidia's Blackwell chips, aiming to bolster its AI capabilities.

This collaboration underscores the strategic importance of partnerships in the competitive AI computing market, as companies strive to enhance their technological prowess.

In addition to the chip rental, Google may also lease space in CoreWeave's data centers for its own Tensor Processing Unit chips, developed in collaboration with Broadcom.

On April 2, 2025, CoreWeave's stock surged 14% to over $60, marking a significant recovery from its IPO price of $40 just a week earlier.

The recent IPO on Nasdaq has seen CoreWeave's stock rise 53% from its initial offer price, driven by substantial contracts in the burgeoning AI sector.

Nvidia's Blackwell GPUs are currently facing significant order backlogs, with wait times extending up to 12 months due to high demand.

The demand for AI computing resources is projected to escalate, with Nvidia's CEO indicating that future models will require 100 times more computing power than current technologies.

The ongoing shortage of NVIDIA GPUs has created supply constraints for AI firms like xAI and OpenAI, highlighting the pressing need for more GPU resources.

CoreWeave is rapidly expanding its AI data center capabilities and has secured a $12 billion, five-year deal with OpenAI to meet its AI infrastructure needs.

Despite Microsoft representing 60% of CoreWeave's $1.9 billion annual revenue, the company is actively seeking to diversify its client base.

Both Google and Nvidia have faced stock declines of 17% and 20% year-to-date, yet the potential for growth in AI infrastructure remains substantial.

Amid reports that Microsoft may terminate some data center leases, Google is exploring the opportunity to acquire additional capacity from CoreWeave.