Cloudmaxxing sucks Nvidia into dangerous game
NVDA•Breakingviews column on Nvidia’s financing risk
The chipmaker may backstop $600 billion of financing for OpenAI and SoftBank to build a 10 GW data center. Ever-bigger and pricier projects are already chewing up free cash flow at Google and beyond. By supporting weaker developers, boss Jensen Huang risks dulling his company's edge.
Full view will be published shortly.
Context news on the reported OpenAI and SoftBank project
Nvidia is in talks to provide roughly $250 billion in financing guarantees for OpenAI as part of a massive data center project, the Wall Street Journal reported on July 26, citing unnamed sources.
The backstop would help the ChatGPT developer lease a 10-gigawatt project that SoftBank's subsidiary SB Energy is developing in southern Ohio, according to the report.
The guarantee would cover the data center lease and debt financing, but not the Nvidia chips inside, the newspaper reported, adding that the chipmaker was also discussing financing OpenAI's chip purchases, worth up to $350 billion. The first phase of the project is expected to be finished in 2028, with around 800 megawatts of power.
