When British cloud computing company Nscale goes public, it will face a key test of whether investors are willing to buy shares in a company whose revenue depends heavily on just two major customers. Nscale, which was spun off from an Australian cryptocurrency mining firm called Arkon Energy two years ago, has secured over $103 billion in contracts, according to its initial public offering (IPO) filing. However, the vast majority—about 85%—comes from two major deals: a $43.8 billion contract to provide computing power to Microsoft through 2033, and a $44.6 billion agreement with Anthropic, an artificial intelligence (AI) startup. This second deal is conditional on Nscale securing financing, and Anthropic has the right to cancel the agreement if the company fails to meet specific, challenging milestones outlined in the filing. Nscale’s heavy reliance on a small number of customers highlights how deeply interconnected the AI industry has become. A recent analysis by Sona Asset Management, a credit-focused hedge fund, found that many companies that provide infrastructure for AI systems depend on just a few major clients. For example, Nscale’s competitor CoreWeave generates 67% of its revenue from Microsoft, while another data center builder, Applied Digital, gets 67% of its income from Oracle and 30% from CoreWeave. While Sona noted that this level of interconnectedness isn't inherently bad, it warned that a single misstep or strategic shift by a major player could ripple across the entire industry. Nscale is planning to list on the New York Stock Exchange (NYSE), and according to the Financial Times, it expects to be valued at $35 billion. The company is aiming to raise $3 billion in its IPO, as reported by Bloomberg. Its financial performance has improved rapidly: revenue for the six months ended June 30 was $140.6 million, compared to just $10.4 million a year earlier. However, the company’s net losses have surged to $1.02 billion, up from $369 million in the same period last year. Earlier this month, a major investor, Nvidia, agreed to provide Nscale with $1 billion in convertible debt as part of a larger $3.1 billion financing deal. The startup was valued at $14.6 billion when it raised a $2 billion Series C round led by Aker ASA and 8090 Industries. Nscale faces competition from several other firms, including CoreWeave, Nebius, Lambda, and Crusoe, which recently raised $3.9 billion at a $30.9 billion valuation. Nscale operates data centers in Norway, Portugal, Texas, and West Virginia. Its board of directors includes former executives from major tech companies, such as Sheryl Sandberg and Nick Clegg from Meta, and Fidji Simo from OpenAI.