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Back to Can AI Keep Growing Exponentially? Let’s Ask SemiAnalysis — With Dylan Patel and Jordan Nanos, with Dylan Patel & Jordan Nanos.

Why Did Oracle's New Mexico AI Data Center Slip?

Dylan Patel says Oracle's New Mexico data center slipped because the pipelines were not going to arrive, and the site cannot be built without them. SemiAnalysis told clients in April that the delay was coming, then again in May and June. Oracle later announced the setback and the stock fell. OpenAI has contracted a huge data center with Oracle there, and the delay could run multiple years. A Wisconsin site has slipped as well.

ClusterMax is not a stock call. It scores how reliable, secure, and usable a rented GPU cluster is, and on that score Oracle is still one of the top neoclouds. Patel calls the company solvent. The OpenAI deals were signed at a fixed margin, so Oracle cannot collect the higher GPU rental prices other clouds are charging now. Oracle and CoreWeave are locked into long contracts. Nebius, which has the shortest average contract among the top ClusterMax clouds, has been able to raise prices.

Transcript

Can AI Keep Growing Exponentially? Let’s Ask SemiAnalysis — With Dylan Patel and Jordan Nanos ·

Big Technology Podcast

More from this episode

  1. How Big Is Next Year's AI Capital Spending?Dylan Patel says next year's capital spending for the AI build-out in the United States is on the order of $2 trillion.
  2. Can AI Infrastructure Spending Keep Growing Exponentially?Dylan Patel says AI capital spending cannot keep compounding at triple-digit rates from here. The build-out runs out of things to organize.
  3. How Much Revenue Does $1 Trillion of AI Data Center Spending Need?Dylan Patel says a trillion dollars spent today on an AI data center and GPUs needs about $1.5 trillion of revenue over six years if payback is a straight…
  4. Is Anthropic Profitable After Compute Costs?Dylan Patel says Anthropic is now profitable once revenue is set against compute cost, with training and inference combined.
  5. Will AI Replace Knowledge Work in the Next Few Years?Dylan Patel says AI will not replace knowledge work in the next few years.
  6. Can Hyperscalers Cancel Neocloud Contracts Each Month?Jordan Nanos says hyperscalers and large frontier labs signing neocloud contracts generally do not have a right to cancel every month and walk away.
  7. Could Anthropic Be Worth $10 Trillion?Dylan Patel says Anthropic could be the first company in the world with a $10 trillion valuation, and the bullish case also reaches $20 trillion.
  8. How Much Is Nvidia Backstopping Neoclouds?Jordan Nanos says SemiAnalysis is tracking $588 billion of off-balance-sheet backstops that Nvidia is supporting.
  9. Can Open-source Models Hack a Neocloud?Dylan Patel says most neoclouds have terrible security, and open-source models can hack one or reach other customers' data on it.
  10. Why Do So Many Neoclouds Fail ClusterMax?Jordan Nanos says most neoclouds still miss the ClusterMax bar because a seller's market rewards raising money, building data centers, and deploying chips…
  11. Which AI Lab Has the Least Compute?Dylan Patel says DeepMind has the least compute of Anthropic, OpenAI, and DeepMind by the end of the year.
  12. Why Do AI Labs Keep Their Best Models Internal?Dylan Patel says frontier labs are keeping months of new-model progress inside the company, because once a model is public other people can distill it.

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