CoreWeave and the Never-Ending GPU Depreciation — A Masterclass in Accounting Elasticity
CoreWeave and Nebius, two public companies riding the AI infrastructure wave, both operate nearly identical business models: providing high-performance GPUs — such as NVIDIA’s H100 and H200 — as rental compute infrastructure for AI workloads.
Their equipment is essentially the same.
Their revenue models are the same.
And yet, their accounting treatment of these assets is anything but the same.
CoreWeave, now valued at an eye-popping $80 billion, has stockpiled hundreds of thousands of GPUs — many of which are basically acting as collateral for loans and debts. But that doesn’t really matter. After all, GPUs don’t depreciate that fast… right? Well, that depends who you ask — Magentar or NVIDIA.
NVIDIA, for its part, announced last year that it’s moving from a two-year product cycle to a one-year cycle. Meaning: GPUs, which were already aging fast, are now expected to become outdated twice as quickly.
But apparently, that’s not something CoreWeave is too concerned about. CoreWeave still has to deal with the issue of that collateral. And whether GPUs are actually losing value faster or not isn’t the point — what matters is how you write it down.
So, in January 2023, CoreWeave made a simple fix: it extended the depreciation period for its GPUs from four years to six (!). And even after NVIDIA’s change in strategy made that timeline questionable — nothing changed.
Nebius, by contrast, depreciates the same class of hardware over four years. That’s a full two-year difference.
And again — same business model, same GPU use case.
The story doesn’t end there.
Nebius estimates the useful life of its data center infrastructure and equipment at 3 to 10 years. CoreWeave? 8 to 12 years.
Same equipment, longer stretch. maybe CoreWeave's servers drink collagen?
It’s worth pointing out: neither of these companies is a hyperscaler. They’re not Amazon, Microsoft, or Google — who use GPUs for internal workloads and can stretch out value over time.
CoreWeave and Nebius earn revenue only when their GPUs are rented externally.
And with the pace of Nvidia's future roadmap and how companies want to rent only the best AI chips, GPU's window is often just 12 to 24 months.
So under a business model where the hardware becomes less useful fast, assuming six years of economic value starts to look a little ambitious.
Longer depreciation means lower yearly costs, higher short-term profits, and a much nicer-looking financial statement — which tends to help when you’re trying to pump the an $80 billion valuation stock.
So did CoreWeave discover the secret formula to make GPUs last longer — or maybe even run faster with age? Should Nebius be knocking on their door, asking for the recipe?