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Nvidia CEO Jensen Huang told CNBC Thursday that demand for neocloud firms is "off the charts," but scarce capital is holding back growth.
"If you look at the fundamentals, the demand for the neo clouds is off the charts," Huang told CNBC's Arjun Kharpal on the sidelines of the company's GTC conference in Berlin on Thursday, adding that capabilities are "extraordinary."
"What is missing in the middle is the working capital to fuel that growth… because there's just so much demand across so many sectors of AI, there's a scarcity of capital," Huang said.
"The demand of the capital is much greater than the availability of the capital. That's going to get solved," he added.
Power is a major constraint for the AI boom, particularly in Europe, where electricity prices are higher. Huang said that the allocation of energy — which is scarce in the region — to companies like Nebius and Mistral is crucial for their growth.
"You can bring investments into Europe, but you have to start with having your own infrastructure," Huang explained. "If the neoclouds in Europe are able to establish an infrastructure here, then you can build the AI ecosystem, the AI economy on top of them, and then the flywheel of the AI economy will start in Europe. It will terminate in Europe."
He added: "Across all of Europe, you're going to need a lot more neoclouds."
Huang has been on a European media blitz this month as the chip giant looks to expand investments in the region's AI sector. The company has committed nearly $10 billion towards companies, universities, and research institutions.
While visiting London last week, Nvidia announced a stake worth over $1 billion in five U.K. startups. The chip giant is also investing in various French startups.
"We're trying to kickstart the AI economy in Europe," Huang told CNBC. "Europe has a tremendous amount of technology, tremendous amount of industrial know-how, incredible science and technology, and it's ready to engage and build the AI economy here."
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