Meta plans to rent out excess AI cloud capacity, competing directly with CoreWeave and Nebius

Harsh Chauhan, The Motley Fool Tue, July 7, 2026 at 4:18 AM PDT · 5 min read

• META +2.98%
• NBIS -1.21%
• CRWV +5.77%
• NVDA +0.37%

Shares of neocloud infrastructure providers CoreWeave (NASDAQ: CRWV) and Nebius Group (NASDAQ: NBIS) were clobbered on July 1 after it emerged that hyperscaler giant Meta Platforms (NASDAQ: META) plans to compete with them.

CoreWeave stock shed almost 14% of its value in a single session, while Nebius dropped by 17%. Meta Platforms, on the other hand, gained nearly 9% after Bloomberg News reported that the Magnificent Seven company is planning to rent out its excess cloud computing capacity to customers. That doesn't bode well for CoreWeave and Nebius at first, as both companies are in the business of building dedicated AI data centers and renting out their capacity to customers looking to run AI workloads in the cloud.

So, it was easy to see why their shares fell substantially following the Bloomberg News report. In fact, Meta won't just be moving into Nebius and CoreWeave's territory; the tech giant's reported move could also hurt the prospects of these neocloud providers. Let's see why that may be the case.

CoreWeave and Nebius Have Signed Massive Contracts with Meta Platforms

Meta Platforms has been spending aggressively to build AI data center infrastructure capacity. At the same time, the tech giant has been renting capacity from CoreWeave and Nebius to support the rollout of AI tools across its apps and advertising platform.

• CoreWeave expanded its agreement with Meta in April this year to provide cloud computing capacity through December 2032 in a deal worth $21 billion. The two companies had originally signed a $14.2 billion deal in September 2025.
• Nebius announced in March that it will provide $12 billion in dedicated cloud computing capacity to Meta starting early next year. Additionally, Meta has committed to buying $15 billion in additional capacity over five years, which Nebius had originally planned to sell to other third-party AI cloud customers. The total value of this agreement was worth $27 billion.

Not surprisingly, shares of Nebius and CoreWeave dropped like a rock after Bloomberg News reported Meta's planned initiative of selling its excess AI computing capacity to customers. However, the report also added that this business plan is currently in development and may change.

The Sharp Decline in These AI Stocks Could Be a Buying Opportunity

There is no doubt that CoreWeave and Nebius could take a hit if Meta decides to compete with them, especially considering that it is a customer. However, Meta's plan of selling AI computing capacity to customers isn't official yet. But even if that were to be the case, investors shouldn't forget that the demand for CoreWeave and Nebius' dedicated AI data centers is exceeding supply.

CoreWeave management noted on the May earnings call that the demand for its AI cloud platform "is accelerating a..."