Next AI deal: Nvidia plans to invest $100 billion in OpenAI

Nvidia wants to implement the “largest AI infrastructure project in history” with OpenAI and, at the same time, invest $100 billion in the AI company. Both companies have now announced this and explained that the aim is to bring AI technology out of the lab and into the world. As part of the collaboration, Nvidia plans to provide at least 10 gigawatts of its technology for OpenAI's future infrastructure, including the new Rubin architecture AI accelerators. According to information from the Reuters news agency, the agreement stipulates that Nvidia will receive non-voting shares in OpenAI for its billions, and the AI company will use the money to purchase Nvidia GPUs. These are to be used from 2026 onwards.

Concerns about financial viability

Even though Nvidia's share price jumped after the announcement, there are also critical voices. Reuters quotes an analyst who points out the circular elements in the agreement. According to Bloomberg, Nvidia itself has assured that the collaboration with OpenAI will not change its focus on its other customers. “We will continue to treat every customer with the highest priority, whether we have a stake in it or not,” the news agency quotes. Although Nvidia is rushing from stock market record to stock market record, the chip manufacturer generates most of its revenue from a handful of tech companies that are building AI infrastructure. If they have concerns about Nvidia's priorities, they could look for alternatives.

Just last week, Nvidia announced its intention to buy Intel shares worth $5 billion, giving it a four percent stake in the company. OpenAI, for its part, is already working with other companies on the immensely expensive task of building the infrastructure for AI development. Two weeks ago, it was announced that the AI company had signed a $300 billion deal with Oracle. However, it remains completely unclear where the money will come from. All AI companies combined will generate approximately $13 billion in revenue this year. According to a report by consulting firm Bain & Co., they would need to reach a combined total of $2 trillion by 2030 to pay for the expected demand for computing power, writes Bloomberg. However, only $1.2 trillion is expected.

(mho)