Neoclouds, or specialized computing infrastructure focused on AI, are soaring sky-high.
On Wednesday, Nscale, an AI infrastructure firm, announced plans to go public towards the end of 2026, according to CNBC. The company also announced an expanded partnership with Microsoft worth $14 billion to supply the company with 200,000 Nvidia chips.
“The pace with which we have expanded our capacity demonstrates both our readiness and our commitment to efficiency, sustainability and providing our customers with the most advanced technology available,” Josh Payne, founder and CEO of Nscale, said in the company’s announcement.
The deal comes just weeks after Nscale announced two funding rounds in one week: $1.1 billion Series B and an additional $433 million pre-Series C agreement.
The news adds to the growing buzz around so-called neoclouds.
- CoreWeave went public earlier this year, with its share price now sitting more than 230% higher than when it debuted. The company has also inked multi-billion-dollar infrastructure deals with Meta and OpenAI.
- In September, Nebius scored a $19.4 billion partnership with Microsoft, and Lambda inked a deal with Nvidia worth $1.5 billion.
The popularity of this AI-specific infrastructure is only projected to grow. According to Synergy Research Group, neocloud revenues are on track to exceed $23 billion this year and could reach almost $180 billion by 2030.
It makes sense why neoclouds are getting so much attention. It’s why AI giants are investing hundreds of billions in developing data centers through partnerships and projects like Stargate. The demand for AI infrastructure is surging, and traditional cloud offerings simply might not be cutting it anymore. The popularity of neoclouds, however, allows for the compute to not be centralized solely in the hands of the biggest names in AI.