Nscale debt hits $5.5 billion as AI equipment orders drive funding needs

Nscale says it needs to raise more money to meet its expected obligations in 2027 after committing to new equipment orders for its AI cloud business. The British company’s amended US IPO filing, dated November 12, puts its September 30 debt at a preliminary $5.52 billion. That is about 40 times the $137.4 million it reported at the end of June.

The new funding need is tied to an agreement to supply computing capacity to Anthropic. Nscale said it ordered GPUs and networking gear ahead of delivery to manage prices, lock in equipment allocations and reduce exposure to penalties for delays. Some of those orders restrict its ability to reduce spending or move it to a later date. When it filed the amendment, Nscale said it had yet to obtain binding financing commitments for the work required under the Anthropic agreements.

Revenue and debt both grew

In its September registration statement, Nscale expected existing cash, committed borrowing and customer prepayments to cover at least 12 months of expenses and debt service under its operating plan at the time. The amended statement accounts for larger equipment orders and near-term spending. Nscale put cash and cash equivalents at a preliminary $3.58 billion as of September 30. The filing gives no separate dollar figure for the additional financing it expects to need in 2027.

Preliminary revenue for the first nine months of 2026 was $307.5 million, up from $21.3 million a year earlier. The net loss widened to an estimated $1.69 billion from $433.3 million over the same period. Nscale based the latest numbers on internal records and said they remain subject to its reporting process and review by its independent accounting firm.

Equipment orders come before Anthropic’s payments

Anthropic outlined its side of the arrangement in its own IPO filing on November 10. It agreed to pay up to about $44.6 billion over contracts running into 2033. Charges accrue when Nscale delivers computing capacity and Anthropic accepts it. The agreements allow Anthropic to terminate in limited circumstances, including if Nscale falls short of specified delivery or service availability requirements.

Nscale must use its best efforts to arrange qualifying financing for the Nvidia GPUs and the data center at its Monarch campus in West Virginia within the agreed period, which the two companies can extend.

Nscale estimated that the campus’s first building and its power infrastructure would cost $10 billion to $10.5 billion. It had incurred about $1 billion of that amount by the end of September. Nscale accounts for GPUs and other computing equipment separately. For the same development, West Virginia’s Department of Environmental Protection set a November 13 deadline for written public comments on an air permit application for on-site power generation in Mason County.

Some capacity has already come online. Nscale counted about 50,000 active GPUs in the amended filing, up from roughly 25,000 at the end of August. Across the two filings, the combined tally of active and contracted GPUs stayed at about 461,000. The number of active data center sites rose from five to seven. The company reported 1.37 gigawatts of active and contracted power capacity in both disclosures.

Nscale announced a $3.36 billion financing agreement in September. Nvidia subscribed for $1 billion of the initial $2.36 billion in convertible notes, according to the amended filing. It is due to provide another $1 billion in a transaction that Nscale expects to close around November 16. Nscale plans to issue notes that convert into non-voting shares at the IPO if the transaction closes before the registration takes effect. If it closes on or after that point, Nscale plans to issue the non-voting shares directly.

Nscale has applied to list on the New York Stock Exchange under the ticker NSCL. The amended filing leaves the proposed share price range blank. Separately, Anthropic exercised a right on September 29 to negotiate for additional compute in Monarch’s second building. The companies have 60 days from that date to negotiate an agreement, subject to a mutual extension.