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  "documentTitle": "2025 Air Street Capital The State of AI Report 2025",
  "authorId": "AirStreetCapital",
  "authorName": "Air Street Capital",
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  "notes": "Includes a meme/photo illustration referencing Woody Harrelson in 'Now You See Me' to illustrate financial sleight of hand.",
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      "text": "This financial sleight of hand works to conceal the mountains of debt accumulation within the AI sector.",
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      "text": "Hyperscalers increasingly offload their debt using special purpose vehicles (SPVs). In an SPV, the hyperscaler contributes assets (GPU-clusters), while the financial partner injects capital. Although the hyperscaler maintains control and use of the GPU-cluster, the debt then sits outside that parent company.\nHyperscalers pay a premium (2-3%) to protect their credit rating and maintain investor sentiment. Private credit players love these deals as they involve reliable borrowers and giga-projects are easier to manage than many smaller loans.\nRisk could arise if utilization lags. Since SPVs sit outside the core business and are often bound by strict cash flow covenants, defaults become more likely. At the same time, private credit funds, often backed by long-term pension or insurance capital, are financing short-lived, fast-depreciating assets. This creates a temporal mismatch, with AI data centers treated as long-lived, stable infrastructure projects.\nExamples: Meta's $26B deal, Stargate, Vantage's deal in Texas, CoreWeave.",
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      "text": "To maintain healthy-looking balance sheets, hyperscalers increasingly use exotic financial structures like SPVs. This financial sleight of hand works to conceal the mountains of debt accumulation within the AI sector.",
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      "kind": "title",
      "text": "Out with corporate borrowing, in with SPVs, JVs and accounting gymnastics",
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      "evidence": "NVIDIA's circular GPU loops (p.156), Oracle/OpenAI/NVIDIA triangle (p.157), debt instruments (pp.159-161).",
      "position": 9,
      "objective": "Trace circular AI capital deals across the stack",
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