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Volatility in the GPU rental market - by Neha Desaraju

quantfutures.substack.com · 2,137 words · saved by 1 readers

Very few organizations have an accurate model of pricing and trends in the high-grade GPU provider market (and demand side). It doesn’t help that the market landscape can be murky. There aren’t clear demarcations between each category of player — is CoreWeave a neocloud, or a hyperscaler like they claim to be? What’s the difference, really? — and incentive structures, sources, and money flow are hidden, especially to outsiders. As a customer, when you shop for a provider, what are you really paying for beyond just hardware access? Is this provider just a reseller — which providers are really just brokers, third-parties, or middlemen? How many sides to this market are there? The last three years have seen large swings in supply and demand for AI infrastructure. A flood of new H100s — initially mispriced due to delays in the market and overpromises — kicked off a long price decline, with further downward pressure in going-price for AI GPU rentals caused by significant changes in GPU-use

Volatility in the GPU rental market A model for studying AI compute bubbles Neha Desaraju May 28, 2025 8 Share Cross-posted by Quant Futures "Previous work from our team." - Neha Desaraju Very few organizations have an accurate model of pricing and trends in the high-grade GPU provider market (and demand side). It doesn’t help that the market landscape can be murky. There aren’t clear demarcations between each category of player — is CoreWeave a neocloud, or a hyperscaler like they claim to be? What’s the difference, really? — and incentive structures, sources, and money flow are hidden, espec

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