What CoreWeave, Nebius, Alphabet, Meta, Amazon, Microsoft and Oracle assume in their 10-Ks, how much one year of useful life moves profit, a worked straight-line example, and the evidence on both sides of the argument.
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In company accounts, five to six years; in the market, nobody knows yet, because the current GPU generations have not been around that long. A GPU can keep running for years after purchase, so the real question is how long it earns enough rent to justify its cost while new generations keep arriving (NVIDIA said in August 2026 that its Vera Rubin platform was ramping into full production, with racks running at partners including CoreWeave and Nebius). Accountants call the first number the useful life; investors care about the second, the economic life.
Scope: how listed AI cloud companies and hyperscalers depreciate servers and GPUs in their SEC filings, and why it matters for earnings, debt and stock analysis. It does not cover gaming GPUs, tax depreciation or resale prices of individual chips. Background on the companies is in what is a neocloud.
CoreWeave, Alphabet and Meta lengthened server lives between 2023 and 2025; Amazon lengthened in 2024 and then shortened part of its fleet in 2025. From each company’s latest annual report:
| Company | Useful life for servers / GPUs | Last change | Disclosed effect | Filing |
|---|---|---|---|---|
| CoreWeave | 6 years (technology equipment) | From 5 to 6 years, Jan 1, 2023 | $20M lower expenses in 2023 | 10-K FY2025 |
| Alphabet | Generally 6 years | To 6 years in 2023 | $3.9B lower depreciation, $3.0B higher net income in 2023 | 10-K FY2025 / FY2023 |
| Oracle | 6 years (servers and networking) | None disclosed | Depreciation $7.6B in FY26 vs $3.9B in FY25 (growth, not a change) | 10-K FY2026 |
| Meta | 5.5 years (most servers and network assets) | Lengthened to 5.5 years, Jan 1, 2025 | $2.92B lower depreciation, $2.59B higher net income in 2025 | 10-K FY2025 |
| Nebius | 5 years | From 4 to 5 years, Jan 1, 2026 | ~$167.6M lower depreciation expected in 2026 | 20-F FY2025 |
| IREN | 5 years (HPC hardware) | Not stated | Not stated | 10-K FY2026 |
| Amazon | 5 to 6 years | A subset shortened from 6 to 5 years, Jan 1, 2025 | $1.4B higher depreciation, $1.0B lower net income in 2025 | 10-K FY2025 |
| Microsoft | 2 to 6 years (servers and network equipment) | None disclosed | Not applicable | 10-K FY2026 |
Amazon gave its reason in the filing: the increased pace of technology development, particularly in AI and machine learning. Meta and Alphabet said their changes followed internal assessments of their servers. Both directions are allowed under US accounting rules; a useful life is a management estimate that auditors review, and a change applies going forward rather than restating past years.
Every year of useful life you add lowers the yearly expense, and the effect is largest at short lives. Illustrative: a $1B GPU cluster depreciated straight line to zero (cost ÷ years):
Now suppose the company books 6 years but the cluster stops earning after 3. Years 1–3: depreciation of $1,000M ÷ 6 = $166.7M a year, $500M in total. At the end of year 3 the book value is $1,000M − $500M = $500M for equipment that no longer earns its keep. That $500M eventually has to be written off, usually as an impairment. Profit was not lost; it was shown earlier than it was earned. If the cluster earned, say, $400M of revenue a year (illustrative), pre-tax profit after depreciation would look like $233M a year on a 6-year life and $67M on a 3-year life: the same business, a 3.5× difference in reported profit.
Burry argues that hyperscalers extended server lives while buying chips on a two-to-three-year product cycle, which in his view overstates earnings. In a November 10, 2025 post he wrote that heavy chip spending “should not result in the extension of useful lives of compute equipment” (as quoted by CNBC), and CNBC reported his estimate of about $176B of understated depreciation across 2026–2028. That is one investor’s opinion, not an audit finding. The same concern appears in research form: Gartner said on October 14, 2026 that over $3.5 trillion of AI infrastructure spending could be exposed to impairment by the end of 2030.
The best current evidence is rental pricing for older chips, which has held up in 2026. Nebius’s Q2 2026 shareholder letter reported more than 30% higher pricing on older-generation GPUs than in Q1, and Nebius itself lengthened its GPU life from four to five years on January 1, 2026, citing usage patterns and utilization commitments. A second argument: older GPUs move from training frontier models to inference and smaller jobs, so they keep earning at a lower rate instead of stopping. A third: many contracts now run about as long as the accounting life (IREN’s Microsoft contract has a five-year average term, and IREN depreciates HPC hardware over five years), which ties revenue to the depreciation period. None of this proves a six-year economic life; it shows that, so far, demand has outrun supply.
Because GPUs are most of what a neocloud owns, and its lenders often hold them as collateral. At June 30, 2026, CoreWeave’s property and equipment, net, was $46.7B of $77.1B of total assets; Nebius’s depreciation and amortization was $259.7M in Q2 2026, 45% of revenue. A hyperscaler that shortens server lives takes a hit to earnings but keeps its other businesses; a neocloud whose GPUs lose value faster than its accounts assume can also see the collateral behind its loans shrink. Who carries the chip risk depends on the model:
| Who owns the GPUs | Examples | What a shorter economic life would hit |
|---|---|---|
| GPU cloud | CoreWeave, Nebius, IREN | Earnings, impairments, value of GPU-backed loans |
| Hyperscaler | Microsoft, Alphabet, Amazon, Meta, Oracle | Earnings; offset by other businesses |
| Landlord | Applied Digital, TeraWulf, Hut 8 | Mostly the tenant, unless the tenant fails |
Debt and cash figures for each company are in neocloud stocks compared; the stock pages are CRWV, NBIS and ORCL.
When this page’s worry is wrong: if older GPUs keep re-leasing at similar prices, a six-year life is reasonable and the bear case fades. When the reassurance is wrong: a sudden slowdown in AI demand or a much more efficient chip would cut older-GPU prices first, and the accounting would lag. Limitations: company disclosures are annual, pricing data is selective, and no public dataset tracks GPU rental prices across the industry. The wider valuation question is in are we in a bubble, and the supplier view in should I buy Nvidia stock now.
Market intel provides market context, cross-asset analysis, an events calendar and regular written notes. These can inform your review of an existing plan; they do not reliably predict crashes or guarantee better outcomes.
Five to six years at most large AI companies: CoreWeave and Alphabet use 6 years, Meta 5.5, Nebius and IREN 5 (10-K and 20-F filings, 2026). Microsoft uses a range of 2 to 6 years for servers and network equipment.
Straight line over 6 years. CoreWeave changed the useful life of its data-center computing equipment from five to six years effective Jan 1, 2023, according to its FY2025 10-K.
Amazon cut the useful life of a subset of servers and networking equipment from six to five years from Jan 1, 2025, citing the increased pace of technology development in AI and machine learning. It added $1.4B of depreciation in 2025.
Meta’s move to 5.5 years for most servers and network assets from Jan 1, 2025 reduced 2025 depreciation by $2.92B and raised net income by $2.59B, or $1.00 per diluted share.
In November 2025 he argued that hyperscalers extended server lives while buying chips on a two-to-three-year cycle, overstating earnings; CNBC reported his estimate at about $176B of understated depreciation over 2026–2028. It is an opinion, not an accounting finding.
For now, yes. Nebius reported more than 30% higher pricing on older-generation GPUs in Q2 2026 than in Q1. Whether that lasts depends on demand staying above supply.
Depreciation rises or an impairment is booked, lowering reported profit; for a GPU cloud it can also reduce the collateral behind GPU-backed loans. In a $1B illustration, a 6-year life that proves to be 3 years leaves $500M of book value to write off.
Not by itself. Useful life is a management estimate reviewed by auditors and disclosed with its dollar effect; the debate is whether the estimate matches how long the chips keep earning.
Market intel provides a Risk ON / Neutral / Risk OFF reading from four pillars, cross-asset analysis, an events calendar and regular written notes. Context for reviewing a plan, not a crash forecast.
Educational content, not investment advice. Examples are illustrative; past performance does not guarantee future results.