00:00You've just had a $21 billion deal announced with Meta yesterday. You have Anthropic today, Michael.
00:05What does this mean for your investors in terms of the clarity of revenue growth going forward?
00:10Yeah, first of all, good afternoon. Thank you for having me. But it has been a unique couple of weeks
00:18for us here
00:18because not only have we really made tremendous progress with the likes of Meta and Anthropic,
00:25but we've also had tremendous, overwhelming success in the capital markets as we continue to build the funding mechanisms
00:34to be able to ensure that we are able to execute on our roadmap for growth.
00:41Let's talk about those funding mechanisms because you're looking at unique ways to be able to get access to credit
00:47lines
00:47by using basically the power of your customer, the fact that Meta is the one that's coming to you for
00:52the compute
00:53and the strength there. You're also tapping, though, well, convertible notes was what was issued yesterday
00:57as well as bonds. We're seeking billions of that. How much more debt are you going to have to take
01:02on
01:02to fuel the growth?
01:05So, you know, we've been very creative about how we kind of look at the capital markets,
01:10making sure that we can execute on our plan in the most cost-effective way.
01:16And so, you know, we issued $8.5 billion worth of bonds at A-minus paper because of the quality
01:25of our counterparties.
01:26And, you know, that was a tremendous reduction in our weighted average cost of capital.
01:33And then we came back yesterday. We did the largest dual offering ever.
01:39And that was both the convertible note that we issued as well as a tranche of high yield, you know,
01:49really positioning us well for the capital requirements.
01:53And it's just the oversubscription to these tools that we're bringing into market,
02:01to the paper that we're bringing to market, really provides tremendous transparency to us,
02:06to our investors, to our clients about how much access we are going to be given to capital
02:13as we continue to execute on this strategy.
02:16And, you know, people are really confident the cost of capital keeps coming down
02:20in our ability to kind of drive the compute that is so dear to all of these model creators and
02:30product,
02:31people who are producing product for artificial intelligence.
02:35You know, it's just been, you know, an extraordinary week, both on the capital raise side as well as the
02:41client contract side.
02:43As the cost of capital comes down, you get to have more.
02:46How much more money do you need to get from the debt markets, Michael?
02:49Yeah. So, look, you know, our strategy continues to be success-driven, right?
02:55And so, we go out and we execute a contract like the one we just did with Meta.
02:59And now, with that contract in hand, we will go into the capital markets and we will raise debt
03:06that will be at a very low cost of capital to be able to build the infrastructure to deliver on
03:11that contract.
03:13Each of our contracts are profitable and drive wonderful return.
03:18And at the parent co, we're just looking to continue to scale into this, you know, unique opportunity
03:24to kind of build, you know, an enormous company that is instrumental in delivering infrastructure to the world.
03:32How much does Anthropic need?
03:35So, we're not at liberty to speak to the size of that contract.
03:39It is a multi-billion dollar contract.
03:41But really, much more importantly than that, from our perspective, this is the first contract that we've executed with them.
03:48It's the first time that they've used somebody out of one of their core investors and they came to us
03:52because of the quality of the infrastructure and the software solutions that we provide.
03:59And so, you know, we just think it's an incredible vote of confidence from one of the most important lands
04:04in the world.
04:05And we think that it's going to be a launchpad for additional business between us and them,
04:10just as every other client that we've brought on, really all the major clients.
04:15They come on, they do a contract with us, and it's a land and expand strategy for both parties.
04:20You know, we really build from that into a very broad-based relationship
04:26where we become an integral part of their infrastructure strategy.
04:32Let's talk about Mythos.
04:33Mythos, does the slow unveil of the model to unique partners, does that signal an issue with compute?
04:43So, look, you know, the strategy that Anthropic is using to, you know,
04:49as they kind of bring their products to market is really, you know, it's their strategy.
04:55You know, our job in this ecosystem is to provide as much infrastructure at the highest quality that we can,
05:02right?
05:02And they came to us, they engaged us, because they have demand for compute
05:08because of the wonderful products that they are bringing to market.
05:10And that's, you know, being echoed across the different labs, you know, universally.
05:16And, you know, our role in this is really to go ahead and to deliver the infrastructure
05:22that these companies are going to need and currently need to be able to successfully deliver their product to market.
05:29And that's what our role must be doing.
05:31Michael, I'm fascinated by the global perspective you have here,
05:34because the geopolitical environment that we live in at the moment means that energy prices are driving up,
05:40particularly over in Europe and the UK.
05:41OpenAI, we have reporting that they're pulling back on their Stargate project in the UK
05:45because energy is getting too expensive.
05:47And yet they're going out to their investors and saying,
05:49look, we're ahead of the game, we're ahead of Anthropic because of our compute that we have.
05:53What are you seeing in terms of people trying to rearrange where their computer's accessed from?
05:58Yeah, look, you know, the way I kind of view it, and my background really is within the commodity space,
06:04is that people are going to be very thoughtful about managing the cost of delivering infrastructure.
06:12And some of that is going to come from the energy side.
06:15And it's going to be, hey, where can we get electrons that are effectively priced so that we can continue
06:23to drive our company?
06:24But it's also going to come from places like CoreWeave,
06:26where our software and the yield on the compute that we build is just higher than other alternatives
06:32because of the quality of the software environment that we built.
06:36And so you're seeing both sides of that coin really being driven,
06:39and you're seeing the success of our infrastructure and the adoption of our infrastructure
06:45because of the part that we can, you know, impact.
06:48And so we look at the different energy markets.
06:51We place our infrastructure in lots of different places in order to mitigate localized risks
06:57such as what's happening in Europe at the moment.
06:59But we really do think that the part that we can directly control
07:03is the quality of the infrastructure we deliver.
07:05Would you pull back from the UK, Michael?
07:08No. No, we have no intention of pulling back from the UK.
07:11We are well positioned there.
07:13We have, you know, a great relationship with the energy companies,
07:18with the data centers, and, you know, with the broader economy over there.
07:24And we absolutely will continue to build and expand our footprint in those jurisdictions.
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