“NVIDIA has a gross margin of greater than 70%. If you're NVIDIA's customer and you're paying this huge margin and you're a huge tech company with a lot of resources, you would be insane not to try to develop your own chips and save some money. … So they need an outlet where they have companies to sell to that aren't trying to replace them. And CoreWeave for NVIDIA is really the primary outlet for exactly that.”

WSJ's Take On the Week · November 2026

Context

Miriam asked why NVIDIA wants CoreWeave, which rents out AI computing power, to succeed. Asa explains that NVIDIA's biggest customers are all building their own chips, so it needs large buyers that aren't trying to replace it.

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Transcript

WSJ's Take On the Week Around 13:32 into the episode

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Miriam Gottfried

Talk to us a little bit more about the relationship between NVIDIA and Core Weave, because I think that's actually a really important point. Why does NVIDIA want Core Weave to succeed?

Asa Fitch

I wrote a piece not too long ago saying essentially that NVIDIA needs Core Weave, and they do. I mean, NVIDIA is selling chips to a lot of customers that want to compete with it. You know, its main customers are Google, Microsoft, of course, Meta. But all of these companies have programs where they're making their own AI chips. You know, NVIDIA has a gross margin of greater than 70%. If you're NVIDIA's customer and you're paying this huge margin and you're a huge tech company with a lot of resources, you would be insane not to try to develop your own chips and save some money, especially when people are deploying AI Trade and inference at the scale they're doing it at. So NVIDIA kind of sees a future, I think, where it could be a little bit in trouble if everybody kind of does their own stuff. So they need an outlet where, you know, they have companies to sell to that aren't trying to replace them. And Core Weave for NVIDIA is really the primary outlet for exactly that.

Telis Demos

So it needs to see companies, it needs to see new entrants in the market for computing power in order to have healthy customers, right? It needs to need to see the success of these guys.

Asa Fitch

Oh, absolutely. And just think about it, even broader terms. It's a power thing, right? I mean, NVIDIA has enormous power over Core Weave. These big tech companies don't need NVIDIA quite as much. And NVIDIA can't really call the shots with these guys quite as much. So if you're in NVIDIA shoes, I…

Telis Demos

But this, see, this though gets me back to like, so what exactly is the market's concern here?

Speaker names come from our own diarization. The position is estimated from where the line sits in the episode.

More from WSJ's Take On the Week

“One thing that's kind of a question mark over all of this is this notion that NVIDIA wants to promote that the chips are commodities. Jensen Huang, CEO of NVIDIA, has repeatedly talked about how these chips are quote-unquote fungible, almost as if they're a currency that you can just exchange from one thing to the next. That is to some degree true. … It's not always the case, though, because you have setups like Google's TPUs, for example.” — Asa Fitch, WSJ's Take On the Week

“Capital is king. The capital window is wide open. People can raise money. Anthropic can, at least they hope. They're hoping to raise up to $100 billion in this IPO. So what matters now for these companies like CoreWeave, like Anthropic, like others, is capital.” — Asa Fitch, WSJ's Take On the Week