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Microsoft signs agreement with CoreWeave to meet OpenAI cloud needs


Microsoft CEO Satya Nadella

Jordan Novet | CNBC

MicrosoftHis massive investment in OpenAI has put the company at the center of the artificial intelligence boom. But that’s not the only place the software giant is opening up wallets to meet the growing demand for AI-powered services.

CNBC learned from people with knowledge of the matter that Microsoft has agreed to spend potentially billions of dollars over many years on cloud infrastructure from startup CoreWeave. announced on Wednesday that it raised $200 million. That funding comes just over a month after the company hit a $2 billion valuation.

CoreWeave sells simple access to by Nvidia graphics processing unit or GPU, which is considered the best available on the market to run AI models. Microsoft signed the CoreWeave deal earlier this year to ensure that OpenAI, the company that operates the viral ChatGPT chatbot, will have enough computing power in the future, one of the people who requested anonymity said for the reason. security. OpenAI relies on Microsoft’s Azure cloud infrastructure to meet its massive computing needs.

Microsoft and CoreWeave both declined to comment.

The innovative AI craze started late last year after OpenAI introduces ChatGPT to the public, demonstrating that AI can take human input and generate complex responses. Many companies, including Google, which has since rushed to add generalized AI to their product. And Microsoft has been busy releasing chatbots for its own services, such as Bing and Windows.

With so many demands on its infrastructure, Microsoft needed more ways to exploit Nvidia’s GPUs. CoreWeave CEO Michael Intrator declined to comment on the Microsoft deal in an interview last month, but he said revenue has “multiplied from 2022 to 2023.”

Nvidia-backed startup Coreweave is headquartered in Roseland, New Jersey, with 160 employees.

CoreWeave

CoreWeave announced funding Wednesday from hedge fund Magnetar Capital as an extension of a round 221 million dollars in April. Nvidia invested $100 million in earlier funding, Intrator said. CoreWeave was founded in 2017 and has 160 employees.

Nvidia’s stock price is up 170% this year. Limit the company’s market in the short term crossed the 1 trillion dollar mark for the first time this week after giving a forecast for the July quarter 50% higher than Wall Street estimates.

Colette Kress, Nvidia’s chief financial officer, said the chipmaker’s growth will be “largely driven by the data center, reflecting a strong increase in demand related to generalized AI and other technologies.” big language model”. OpenAI’s GPT-4 big language model, trained with Nvidia GPU on extensive online data, which is the core of ChatGPT.

Kress called out CoreWeave by name during the call, and in March, Nvidia CEO Jensen Huang mentioned CoreWeave during his presentation at Nvidia’s GTC conference.

by CoreWeave website claims the company can provide computing power “80 percent cheaper than legacy cloud providers.” Among other cards, CoreWeave offers Nvidia’s A100 GPUwhich developers can also find through Amazonthe Google and Microsoft clouds.

Additionally, CoreWeave has a cheaper Nvidia A40 GPU available that is marketed for visual computing, while the A100 is aimed at AI, data analytics, and high-performance computing. Intrator says some CoreWeave clients have struggled to get enough GPU power across large clouds. Potential customers have sometimes asked for newer A100 or H100 GPUs from Nvidia, and the company suggested the A40 GPU instead.

Intrator says these “will do an excellent job at a very reasonable price”.

Microsoft had a discussion with prophesy about two companies renting servers from each other if they need more capacity, Information reported earlier this month, citing an unnamed person.

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