Better Offline - Monologue: Into The Jensenverse

Episode Date: August 28, 2026

In this week's Better Offline monologue, Ed Zitron runs through how the AI bubble has increasingly become Jensen Huang and NVIDIA feeding different companies money, and how NVIDIA’s revenue is mostly dependent on a small handful of customers being able to raise more and more debt every year. EDITOR’s NOTE: I incorrectly say at the beginning of this that NVIDIA’s earnings were this week. They’re next week. Sorry!Newsletter: The AI Hater’s Manifesto: https://www.wheresyoured.at/the-ai-haters-manifesto/ Bloomberg Article: https://finance.yahoo.com/technology/ai/articles/nvidia-500-billion-plan-envelops-164209178.html Please support me by subscribing to my premium newsletter - here’s $10 off your first year of annual: https://edzitronswheresyouredatghostio.outpost.pub/public/promo-subscription/gzqwkv54e1 YOU CAN NOW BUY BETTER OFFLINE MERCH! Go to https://cottonbureau.com/people/better-offline and use code FREE99 for free shipping on orders of $99 or more. --- LINKS: https://www.tinyurl.com/betterofflinelinks Newsletter: https://www.wheresyoured.at/ Reddit: https://www.reddit.com/r/BetterOffline/  Discord: chat.wheresyoured.at Ed's Socials: https://twitter.com/edzitron https://www.instagram.com/edzitron https://bsky.app/profile/edzitron.com https://www.threads.net/@edzitron Email Me: [e-mail] omnystudio.com/listener for privacy information.

This is an IHeart podcast. Guaranteed Human. Didn't catch the latest Roland Martin unfiltered podcast? Here's what you missed. People wake up and go, oh, damn, wait a hold up. They change all of that. Yes. It's real.

This is a wholesale attack. It is targeting black people in every federal agency. It's raw. White folks have never allowed that reckoning to last more than a decade. Catch Roland Martin's daily commentary on the Black Information Network. And download Roland Martin Unfiltered on a lot. IHart Radio app, Apple Podcasts, wherever you get your podcasts. I am talking to a felon right now with face tattoos, and I cannot decide if I like him or not.

That was a caller from my podcast, Therapy Gecko, where I speak with anonymous callers about their problems, relationships, and anything else in the depths of their mind. It all happens on my show, Therapy Gecko. So if you're trying to get out of your own head and into someone else's, this is the podcast for you. Listen to Therapy Gecko on the IHeart Radio app, Apple Podcasts, or wherever you get your podcasts. Dancing with the Stars is looking for a new pro. And since last season, I came in eighth place. I'm basically an expert. I'm Danielle Fischel.

And I'm Val Schmerkowski. And we have a new podcast called Stepping on Toes with Danielle and Val. Every week, we're breaking down Dancing with the Stars, the next pro. To find out who I'll be sharing the ball with next season. Listen to Stepping on Toes on America's number one podcast network. IHeart. Follow stepping on toes and start listening on the free IHeart Radio app today. Hi, I'm Dr. James Stout. You might know me as a host of the podcast it could happen here. But I'm hosting a brand new show now called Natural Causes, where we explain how going outside

is political and look at how we can live together with nature and take care of one another in a world that's on fire. You know, we feel uncomfortable saying something like culture in wildlife, but that's what it is. We're going to explain how a tick can make you sick and how a lizard might be able to help you and what mountain lines can teach us about zombie deer you can see the very faint outline into the aurora what a magical place listen to natural courses on the i-hurt radio app apple podcast or wherever you get your podcast also media hello and welcome to your latest better off-line monologue i'm your host ed zitron the groundhog once again saw its shadow with invidia reporting record earnings continuing to inflate an ever more dangerous AI bubble with $96 billion worth of revenue

and 16% of that coming from a single unnamed customer. For the first half of the fiscal year 2027, 477 billion in revenue came from a mere three customers. And as a note, this was all part of its second quarter fiscal year's 2021. You're going to be confused, but Nvidia's fiscal years run from February 1st of the year before to January 31st of the year of. So it's currently fiscal year 27, which begun on February 1, 2026. Annoying, but I didn't do it. Don't blame me. Don't be mad at me, Tharo, Nvidia does business. Anyway, to make matters worse, 70% of Nvidia's current accounts receivable, so Gid that's been shipped to a customer that's yet to be paid for, is from five customers, something that

NVIDIA reported while adding that for certain investment-grade customers, it was offering payment terms ranging from 90 days to an entire year. If you're wondering what investment grade could refer to, both Corweave and Nebius, two unprofitable Neo-Clouds that exist only to raise debt and buy GPUs, mostly to rent them to the same three or four companies, have had their debt rate as investment grade by ratings agencies because they're collateralized by contracts by companies with good credit. What is it with ratings agencies? It's just like every time you put your hands in front of your face, and they'd be like,

where'd they go? Anyway, all of this is a very complex way of saying that the vast majority of Nvidia's revenue comes from a handful of companies, each one, including hyperscalers that make up more than 50% of its revenue over the last few years, are now reliant on debt thanks to skyrocketing costs of Nvidia's GPUs. While Nvidia is unquestionably profitable and thriving revenue-wise, it's only doing so because of a few companies who are willing to be fin-domed by Jensen Huang, and it's all beginning to look like the AI bubble only continues to inflate as long as Nvidia can keep pumping it full of money and hype. You see, in the run-up to

earnings, Nvidia sunk $6 billion into Pooleyside, a flailing open-source LLM company that failed to raise billions of dollars earlier in the year, hiring away most of its staff in what its founders said was not an aqua hire, other than the fact that everyone's leaving and other than the founders. Anyway, Nvidia is also rumored to be sinking billions into pathetic AI search company perplexity, a $30 billion valuation, which is insane and it's not worth that, likely because Perplexity is one of the few companies in the world that buys any significant amount of AI compute, luckily a few hundred million dollars a year, but I'm just guessing. It's also investing in Stargate Abilene Landium at a multi-billion dollar valuation, as well as considering putting money into AI data center

power company Cloverleaf and backstopping over $100 billion of a soft bank backed data center for open AI to rent out in Ohio, though that backstop only kicks in if the thing actually gets built. Ship, chip, sorry, forgot one. InVVVie is all. also buying AI model hosting platform Hugging Face for a little under $13 billion. For some context, Hugging Face had $150 million in annualized run rate, which works out to a pathetic $12.5 million a month, which is insanely small considering its notoriety. It's almost as if every AI company just kind of stinks. As a reminder, Nvidia is invested in Anthropic, OpenAI, CoreWeave, Nebius, Irin, Nscale, Intel, SpaceX, and both Recker and Wecker, which are somehow two different companies. It has backstopped Corweaves leases, signed over $30 billion in

multi-year agreements to rent back its GPUs, and created bizarre revenue share deals where it agrees to backstop data centers and receive a cut of the revenue above a certain threshold, which is obviously dependent on the bloody thing being built and also being paid for. And on its latest earnings called CFO Collette Crest said that the company did not see this as circular financing, despite there being so many different deals where the money moves in a perfect circle, the mainer James Keenan is mumbling some shit about Judith and Magdalena. The AI bubble is becoming increasingly about whether Jensen Huang and Nvidia can keep slapping duct tape on the sides of Data Center and AI model companies, and in turn whether hyperscalers can keep raising enough debt to keep paying

for their GPUs and more. To quote Lindsay Tyler and Nishan Sadiarm of Morgan Stanley, Nvidia is now a balance sheet as a service company with over $366 billion in commitments, including $25 billion of data center leases yet to commence, which is strange, considering Nvidia is the company that sells the data centers, the GPUs. Why does Nvidia need to rent back the GPUs? I thought the demand for AI was so high, Jensen. And if you weren't already a little bit concerned, Huang also claimed on an analyst's call that the world has already achieved artificial general intelligence,

which he defines as the ultimate form of the technology where the machines can think and act for themselves. This has, of course, not actually happened, will not actually happen, and should genuinely get him lambasted in the press, but because number has gone up, everybody is happy. Yay! Yay! Good job, Jensen! AGI's here, yay! Fucking kill me. Yet somehow the dumbest thing that was said on the earnings call

came from Nvidia's CFO, said that Invidia will grow its revenue by 70% in fiscal year 2028, which begins February 1st, 27, I know it's annoying. And based on consensus estimates for the current fiscal year being at $396 billion, this means that Nvidia is expecting to make over $674 billion next year. It's not impossible, but to do this, Nvidia will need its current customers, predominantly Amazon, Google, Microsoft, Meta, SpaceX, and Oracle to likely double their current orders for GPUs, as well as neoclots like CoreWeave to raise even more debt than they're currently raising.

And to be abundantly clear, Call Weave is already having to pay over 9% interest on its debt just to get investors through the door. Again, not impossible, but it's going to require so much more debt. I mean, this must be over a trillion at this point in the next year. It's completely fucking insane. And much like Open AI and Anthropic must continue growing their revenues, customer base and funding rounds to meet over $1.1 trillion in compute agreements. Invitya must, through science or magic, find ways for its customers to be be able to buy more and more and more GPUs every single quarter from here into eternity. As I've said again and again, the AI boom is only possible as long as debt can sustain it. SoftBank has had to take out tens of billions of dollars of debt to fund OpenAI and now is trying to sell $20 billion of bonds to refinance that debt. Corweave can only keep building data centers as long as the banks give it money. Oracle, Google, Amazon, Meta, and SpaceX cannot afford to buy GPUs out of cash flow, and thus are dependent on debt to continue buying those GPUs.

Even Invidia itself has had to take out over $25 billion in bonds. Maybe it's $20 billion. Regardless, still a lot of money. And that supposed $500 billion fund, I'm doing air quotes, you can't see it because this is an audio podcast, per Bloomberg, is nothing of the sort. I'll link to the article in the notes, but that announcement was literally just in Vividia saying

that a group of asset managers would invest half a trillion dollars in AI data centers and that number, and I quote, had no obvious provenance. hyperscalers are only spending this money because Anthropic and Open AI have committed to spend over $400 billion renting GPUs in the next three and a half years, according to analysts. And without that, spend, 30% or more of their cloud revenues will evaporate. For example, per UBS, Anthropic and Open AI will make up over 48% of Google Cloud's revenues in 2027, which will only be possible if they can both afford to spend the money and the data center capacity is actually available. and data centers are taking forever. Another problem. Nvidia is investing in every schmuck with a ponchant,

that's definitely how you say it, for AI models because any AI company becoming insolvent or doing a downround would break the illusion that AI is the next industrial revolution rather than a series of different companies handing money to each other in the hopes that a business model arrives. The reason nobody is freaking out is that nothing bad has happened yet. Invidia's big customers can still raise money to pay it,

and its horrible Neo-Cloud progeny can continue to loot the debt markets from gullible investors who have been lied to by analysts and the media about AI's promise and stability. Everything comes down to whether near-infinite resources are available for AI in perpetuity, and when those resources slow or stop, so too will the music. I'll be back next week with my boys Caleb and a reef to talk about horrible AI slop and whatever else crosses our wretched little minds. Thank you for listening. I love you all. Here's what you missed.

There should not be a single law enforcement agency. It does not have body cameras. It's real. Black farmers have been under attack. This is just the latest example of them just slapping DEI on anything. It's raw. And I'm sitting here going, they are playing y'all for fools. Catch Roland Martin's daily commentary on the Black Information Network.

And download Roland Martin unfiltered on the IHart Radio app, Apple Podcasts. Or wherever you get your podcasts. I am talking to a felon right now with face tattoos, and I cannot decide if I like him or not. That was a caller from my podcast, Therapy Gecko, where I speak with anonymous callers about their problems, relationships, and anything else in the depths of their mind. It all happens on my show, Therapy Gecko. So if you're trying to get out of your own head and into someone else's, this is the podcast

for you. Listen to Therapy Gecko on the IHeart Radio app, Apple Podcasts, or wherever you get your podcasts. Hi, I'm Dr. James Stout. You might know me as a host of the podcast It Could Happen Here. But I'm hosting a brand new show now called Natural Causes, where we explain how going outside is political and look at how we can live together with nature

and take care of one another in a world that's on fire. You know, we feel uncomfortable saying something like culture in wildlife, but that's what it is. We're going to explain how a tick can make you sick and how a lizard might be able to help you and what mountain lions can teach us about zombie deer. You can see the very faint outline into the... Aurora. What a magical place.

Listen to Natural Quarters on the IHat Radio app, Apple Podcasts, or wherever you get your podcast. Dancing with the Stars is looking for a new pro. And since last season, I came in eighth place. I'm basically an expert. I'm Danielle Fischel. And I'm Val Schmerkowski. And we have a new podcast called Stepping on Toes with Danielle and Val. Every week, we're breaking down Dancing with the Stars the Next Pro to find out who I'll be sharing the born with next season. Listen to Stepping on Toes on America's number one podcast network, IHeart. Follow stepping on toes and start listening on the free IHeart Radio app today. This is an IHeart podcast. Guaranteed human.