--- title: "Nvidia's Customer Concentration Problem: CFO Says 'We Get Paid Twice'" type: "News" locale: "en" url: "https://longbridge.com/en/news/298946887.md" description: "Nvidia CFO Colette Kress announced a 'neocloud' strategy to mitigate rising customer concentration, where three clients accounted for 44% of H1 fiscal 2027 revenue. The model involves selling hardware and earning recurring revenue from third-party compute usage, effectively getting 'paid twice.' Nvidia aims to expand its non-hyperscaler customer base, with $36 billion in commitments, shifting from one-time sales to sharing in ongoing AI demand economics." datetime: "2026-09-14T16:30:15.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/298946887.md) - [en](https://longbridge.com/en/news/298946887.md) - [zh-HK](https://longbridge.com/zh-HK/news/298946887.md) generator: "portal-rs" --- # Nvidia's Customer Concentration Problem: CFO Says 'We Get Paid Twice' **Nvidia Corp**‘s (NASDAQ:NVDA) AI revenue comes from just a handful of buyers. CFO **Colette Kress** hopes to turn that customer concentration risk into recurring revenue by getting paid once for GPUs and again when they generate compute income. Three direct customers generated 44% ($78.2 billion) of Nvidia’s $177.8 billion revenue in the first half of fiscal 2027—up from two customers driving 35% a year earlier. That rising concentration underscores how heavily Nvidia’s growth relies on a handful of tech giants. Even as Data Center revenue surged 117% year-over-year to $89 billion last quarter, Nvidia is now pushing to broaden who consumes its compute, not just who buys its GPUs. ## Nvidia Wants to Get ‘Paid Twice’ Enter Nvidia’s “neocloud” strategy. Under the model, Nvidia sells data center infrastructure to AI cloud providers and backs them with cloud-service agreements to help finance capacity. In exchange, Nvidia takes a cut of the rental revenue when third parties use that compute. CFO **Colette Kress** summarized the strategy on the earnings call: "In this model, we get paid twice—once on the hardware sale and again through the share of rental revenue." By capturing that secondary stream, Nvidia moves from simply supplying AI infrastructure to sharing in the ongoing economics of AI demand. **See More: Top Growth Stocks** ## The Customer Base Could Get Much Bigger Nvidia expects non-hyperscaler businesses — including sovereign AI, regional neoclouds, enterprises, edge computing and air-gapped data centers — to represent roughly half of its Data Center business. The company’s neocloud agreements are designed to help unlock that market. Nvidia’s commitments under the new model totaled $36 billion as of July 26. They typically span six years, and decline as third-party customers, or Nvidia itself, consume capacity. That creates a potentially powerful feedback loop: Nvidia sells GPUs to expand the customer base, the expanded customer base drives utilization, and Nvidia gets another revenue stream from that utilization. ## Why it Matters For investors, the bigger story is not simply whether Nvidia can keep selling more GPUs. It is whether the company can turn its dominant hardware position into a recurring claim on the broader AI economy. Watch neocloud utilization, revenue-sharing growth and the expansion of non-hyperscaler demand. If those accelerate, Nvidia’s customer concentration could become less of a weakness — and another source of leverage. **Read Also: This Startup Got AMD Chips to 80% of Nvidia's Speed at Half the Cost** *Image via Shutterstock* ### Related Stocks - [NVDA.US](https://longbridge.com/en/quote/NVDA.US.md) - [NVDB.US](https://longbridge.com/en/quote/NVDB.US.md) - [NVDG.US](https://longbridge.com/en/quote/NVDG.US.md) - [NVDX.US](https://longbridge.com/en/quote/NVDX.US.md) - [NVDQ.US](https://longbridge.com/en/quote/NVDQ.US.md) - [NVDL.US](https://longbridge.com/en/quote/NVDL.US.md) - [NVDS.US](https://longbridge.com/en/quote/NVDS.US.md) - [NVDU.US](https://longbridge.com/en/quote/NVDU.US.md) - [NVD.US](https://longbridge.com/en/quote/NVD.US.md) - [NVDD.US](https://longbridge.com/en/quote/NVDD.US.md) - [NVDY.US](https://longbridge.com/en/quote/NVDY.US.md) - [NVDO.US](https://longbridge.com/en/quote/NVDO.US.md) - [NVDW.US](https://longbridge.com/en/quote/NVDW.US.md) - [NVYY.US](https://longbridge.com/en/quote/NVYY.US.md) - [NYYY.US](https://longbridge.com/en/quote/NYYY.US.md) - [DIPS.US](https://longbridge.com/en/quote/DIPS.US.md) - [MAGX.US](https://longbridge.com/en/quote/MAGX.US.md) - [SMH.US](https://longbridge.com/en/quote/SMH.US.md) - [SOXX.US](https://longbridge.com/en/quote/SOXX.US.md) - [SOXL.US](https://longbridge.com/en/quote/SOXL.US.md) - [SOXQ.US](https://longbridge.com/en/quote/SOXQ.US.md) - [XSD.US](https://longbridge.com/en/quote/XSD.US.md) - [PSI.US](https://longbridge.com/en/quote/PSI.US.md) - [FTXL.US](https://longbridge.com/en/quote/FTXL.US.md) - [07388.HK](https://longbridge.com/en/quote/07388.HK.md) - [07788.HK](https://longbridge.com/en/quote/07788.HK.md) - [09388.HK](https://longbridge.com/en/quote/09388.HK.md) ## Related News & Research - [Nvidia CEO signals strong momentum for shareholders](https://longbridge.com/en/news/298712839.md) - [Ooredoo-backed Zankore secures $3.1 billion financing for Nvidia AI cloud platform](https://longbridge.com/en/news/298435106.md) - [Huang rejects 'circular financing' label for NVIDIA's AI bets](https://longbridge.com/en/news/298649945.md) - [Nvidia (NVDA) CEO Jensen Huang Says AI's Next Big Boom Is "Cybersecurity"](https://longbridge.com/en/news/298636028.md) - [Jensen Huang Calls Nvidia Chips a 'Revenue-Generating Asset' as Older H100 Rentals Reach $3.28 an Hour](https://longbridge.com/en/news/298295419.md) --- > **Disclaimer: This article is for reference only and does not constitute any investment advice.**