Microsoft Has Something Nvidia Doesn’t and Here’s Why it Matters

Meta spends hundreds of millions annually on Microsoft's Azure for AI processing, per Bloomberg. Meta uses Azure to benchmark its own AI models, but may shift to in-house solutions. Microsoft's AI revenue is concentrated among a few large tech clients, including OpenAI and ByteDance.

Nvidia has partnered with Cloverleaf Infrastructure, a 2024-founded data center developer. Cloverleaf, which raised $300M in 2024, facilitates power and infrastructure for data centers. Nvidia's investment, reportedly several hundred million dollars, gives it a minority stake in Cloverleaf, according to Reuters.

Appian (APPN) reported Q2 revenue of $203.3M, up 19.1% YoY, beating estimates. Microsoft (MSFT) reported $90.01B revenue, up 17.7% YoY, also beating estimates. ServiceNow (NOW) reported $3.99B revenue, up 24% YoY, exceeding expectations. All three stocks have risen since reporting results.

Nvidia has partnered with Cloverleaf Infrastructure, a 2024-founded data center developer that raised $300 million. The chipmaker reportedly acquired a minority stake, with potential investments reaching several hundred million dollars. This follows Nvidia's $1.5 billion investment in SB Energy's Ohio data center project, linked to OpenAI.

Morgan Stanley analyst Chris Moore maintained an overweight rating and $288 price target for Nvidia (NVDA) ahead of earnings, citing long-term concerns like market share and gross margins. He expects limited near-term multiple expansion. Moore noted Nvidia's stock typically dips post-earnings despite strong results. Other analysts are more bullish, with an average price target of $308.01, according to MarketBeat.

NVIDIA (NVDA) may ship its next-gen Rubin Ultra GPU with less memory (192GB-256GB) than initially planned (1TB), according to The Information. AMD (AMD) is confident in its Helios AI system, which ships later this year to major customers like Microsoft and Meta, and claims to have secured sufficient memory. Both companies are navigating a memory shortage in the AI chip market.