Invest Like the Best with Patrick O'Shaughnessy · Tuesday, August 4, 2026
Gavin Baker explains that NVIDIA's reported "excess capacity" and potential cap X adjustments were not a sign of disaster, but rather an opportunity to sell optimized clusters at a premium. He suggests this might be a prelude to raising capital.
“What it was is they saw Space X have a big installed base of compute and sell some big trading optimized clusters into the market at a truly massive premium to these contracted rates.”
“So maybe what they're thinking is like, hey, we will show on a small chunk of capacity that we can generate really strong IRR, then we'll go raise equity capital and we'll be off to the races and probably raise cap X.”