Jensen Huang's immediate resignation as Nvidia's president, CEO and board member, announced Thursday, threatens the financial backstops that let heavily indebted neoclouds raise hundreds of millions in debt, according to investor Joe Kaiser.

Nvidia said Huang resigned effective immediately. His exit followed his admission of an extramarital affair with a woman U.S. intelligence officials believe to be a Chinese spy, and a board investigation into the matter. CFO Colette Kress is now interim CEO, and the board named Harvey Jones its first chair.

Why are neoclouds the most exposed?

Kaiser, who started Switchyard Partners at the beginning of this year after serving as CEO of Mercato Partners, which managed about $1.5 billion, argues the risk lies not in the chips themselves but in the financing around them. Neoclouds (cloud providers that buy AI chips in bulk and rent out computing power) such as CoreWeave and Nebius purchase Nvidia chips by the hundreds of thousands, fill data centers with them, and rent capacity to AI labs, competing with Amazon, Google and Microsoft.

Nvidia does more than supply them. It invests: the company held about $329 million in Nebius shares at the end of June. In July, Nvidia began offering to rent back unused GPU capacity from neocloud partners at a fixed rate, a floor designed to make banks more willing to lend. It later joined a $500 billion financing platform with six institutional partners, of which Nvidia may backstop up to $125 billion.

"The chip isn't what puts them at risk, but it's the financial backstop that allows CoreWeave or Nebius to go get those hundreds of millions of dollars of debt from Blackstone and Brookfield," Kaiser told Fortune. "Why is Blackstone willing to back a CoreWeave project? It's because they know that there's an Nvidia backstop, a written backstop, behind it, and so it lowers the risk, and then obviously lowers the interest rate."

CoreWeave carried $35 billion in debt at the end of June, and lenders had grown wary of businesses wholly dependent on AI demand well before Huang left.

"If the capital providers now say that Nvidia guarantee is not worth what it was worth a week ago, that puts those neocloud businesses at risk," Kaiser said. "At the end of the day, this is a heavy-asset, infrastructure-based industry."

Who wins and loses?

OpenAI and SoftBank's SB Energy may be the biggest beneficiaries of the backstops, with CoreWeave and Nebius close behind. Nvidia has been in talks over a reported $250 billion backstop to help OpenAI lease an Ohio data center campus that SB Energy is developing.

Neocloud stocks fell Thursday after the resignation:

• CoreWeave dropped about 9%, giving back part of a 25% rally the day before.
• Nebius fell 16%, though it also issued weak full-year guidance the same day.
• Nvidia lost about $450 billion in market value in the days after Huang admitted the affair, before Thursday's drop.

Kaiser does not expect Nvidia to lose its grip on AI training for at least two or three years, because customers built on its CUDA software (Nvidia's proprietary programming platform) will find it "really hard" to switch. The fight is over inference, the work of running models once trained, which he said now consumes more AI compute than training. There, buyers weigh Nvidia's general-purpose chips against cheaper specialized ones: Qualcomm for robotics, Cerebras, Etched, Google's TPUs and Amazon's Trainium.

"If Nvidia no longer has Jensen as its rainmaker, did that just tip the scale towards using specialized chips?" Kaiser said.

"The bigger play is actually for the specialty chip makers," he said, adding that AMD and Broadcom will inevitably gain an opening. Google and Amazon could win twice: by pitching their own chips to labs like OpenAI and Anthropic, and by lending their balance sheets. "The Googles and others can step into that Nvidia backstop arrangement," he said.

TSMC, which manufactures Nvidia's chips, should come through fine, Kaiser said. He estimated about two-thirds of its capacity goes to Nvidia, but said it could shift that to other customers "in pretty short order."

Is Intel the roadmap for Nvidia?

Kaiser said Huang ran Nvidia on a "hub-and-spoke" model. "The stories are true about Jensen having 60-plus direct reports," he said, which now leaves "this leadership vacuum and vision vacuum."

He drew a parallel to Intel after Andy Grove stepped down as CEO in 1998. "Andy Grove and Jensen both have just this iron-fist approach to management, very disciplined approach," he said. Intel kept growing revenue after Grove left, but lost margin and "didn't adapt as well" as chip demand moved toward new uses.

"Intel is the roadmap here to what might be ahead for Nvidia."

Kaiser also tied Huang's exit to last week's midterms, where data centers became a campaign issue. With Huang, the industry's "true spokesperson" for data centers, now gone, the case for giant single-site data centers weakens further.

"This is just more push for distributed edge compute," he said, "away from these mega monolithic data centers."