When the British neocloud company Nscale makes its public market debut, it will serve as a test of whether public investors are willing to embrace a stock whose revenue is overwhelmingly concentrated among just two customers.

Since being spun out of Australian cryptocurrency mining firm Arkon Energy two years ago, Nscale has accumulated more than $103 billion in contracts, according to its IPO filing. However, there's a significant caveat: roughly 85% of that total stems from a single arrangement to supply Microsoft with $43.8 billion worth of compute through 2033, along with a separate supply agreement valued at $44.6 billion with Anthropic.

What's more, the Anthropic deal hinges on Nscale securing financing, and the AI lab holds the right to exit or cancel the agreement should Nscale fail to meet milestones that the filing describes explicitly as "stringent."

Nscale's heavy reliance on a handful of customers highlights just how deeply intertwined the AI industry has become. A recent paper from credit hedge fund Sona Asset Management, highlighted in the Financial Times, found that numerous AI infrastructure providers depend heavily on a small number of clients. Nscale's rival CoreWeave, for instance, draws 67% of its revenue from Microsoft, while data center builder Applied Digital gets 67% of its revenue from Oracle and 30% from CoreWeave.

While Sona acknowledged that this kind of interconnectedness isn't inherently problematic, it cautioned that a single misstep or strategic pivot by a major player could ripple across the entire industry.

Nscale, which intends to list on the NYSE, is expected to be valued at $35 billion, according to the Financial Times, and is looking to raise $3 billion in the offering, Bloomberg reported. The company posted revenue of $140.6 million for the six months ended June 30, a substantial increase from $10.4 million a year earlier. Net losses, meanwhile, ballooned to $1.02 billion from $369 million over the same period.

Earlier this month, Nvidia — one of Nscale's major investors — agreed to extend $1 billion in convertible debt to the company as part of a broader $3.1 billion financing package. The startup was valued at $14.6 billion when it closed a $2 billion Series C led by Aker ASA and 8090 Industries.

Beyond CoreWeave, Nscale's competitors include Nebius, Lambda and Crusoe — the last of which announced last week that it had raised $3.9 billion at a $30.9 billion valuation. Nscale runs data centers in Norway, Portugal, Texas and West Virginia. Its board of directors features former Meta executives Sheryl Sandberg and Nick Clegg, along with former OpenAI executive Fidji Simo.