BERLIN — Nvidia CEO Jensen Huang acknowledged Thursday that the European neocloud boom faces a hard constraint: not enough capital or electricity to fuel it.
Speaking at GTC, Huang told CNBC that demand for neocloud infrastructure companies is "off the charts," but working capital scarcity is the throttle. "The demand for capital is significantly greater than its availability," he said, adding that he expects the imbalance to eventually resolve as AI sectors mature and capital flows normalize.
Energy is the second brake. Europe's higher electricity costs make data center expansion more expensive than in the U.S. and Huang stressed that allocating scarce power to companies like Nebius and Mistral is essential to their survival. Building local infrastructure—not just shipping Nvidia chips—is the real play, he argued. That infrastructure then seeds an AI ecosystem that localizes the continent's economic growth.
Nvidia has committed nearly $10 billion to European companies, universities, and research institutions. Last week, Huang announced more than $1 billion in investments across five U.K. startups and added French startup backing to the slate.
But the market is pricing in doubt. CoreWeave and Nebius, the bellwethers of the neocloud sector, have both slumped on concerns that returns on massive infrastructure buildouts will take longer than expected. Nebius fell 3.6 percent in premarket trading Thursday. CoreWeave, which has leaned on debt to fund data center expansion, dropped 4 percent. Applied Digital and Iren also declined nearly 4 percent.
The irony: Huang frames capital scarcity as a temporary friction. Investors are pricing it as a structural problem—one that may not resolve until neocloud operators prove they can actually turn data center capacity into durable cash flow.
