Nvidia Scraps $100 Billion OpenAI Investment Plan
Talks collapse over internal concerns at chip giant.
Nvidia has abandoned plans to invest up to $100 billion in OpenAI, according to a report by The Wall Street Journal, marking a significant setback in the deepening ties between two AI powerhouses. The proposed deal, first announced via a letter of intent in September, aimed to fund massive new data centers and AI infrastructure using Nvidia’s cutting-edge hardware. The ambitious project targeted 10 gigawatts of computing capacity—roughly matching New York City’s peak electricity demand.
Negotiations reportedly stalled due to reservations expressed by some Nvidia executives about the scale and structure of the transaction. OpenAI, creator of the widely used ChatGPT, relies heavily on Nvidia GPUs to train and run its advanced models, making the companies natural partners in the AI ecosystem. The breakdown highlights potential tensions despite their long-standing collaboration, with Nvidia having served as OpenAI’s preferred hardware provider for the past decade.
In response to inquiries, Nvidia issued a brief statement emphasizing its ongoing commitment. “We have been OpenAI’s preferred partner for the last 10 years. We look forward to continuing to work together,” the company told Bloomberg News. OpenAI did not immediately comment on the report. Sources familiar with the matter indicated that both sides are now exploring alternative arrangements, including the possibility of Nvidia participating with a smaller investment—potentially in the tens of billions—as part of OpenAI’s current fundraising efforts.
Also Read: Amazon Eyes Massive $50 Billion Stake in OpenAI to Deepen AI Alliance
OpenAI is actively pursuing a massive funding round that could reach $100 billion in total. Recent reports suggest Amazon is in advanced discussions to contribute as much as $50 billion while expanding its cloud computing agreement with the startup. Meanwhile, Nvidia has continued making strategic AI investments elsewhere, including a recent $2 billion commitment to cloud provider CoreWeave, which also purchases its chips. Such circular funding arrangements—where investors back companies that become customers—have sparked debate about the long-term sustainability of the AI investment boom.
Nvidia CEO Jensen Huang has previously dismissed concerns over these deals, arguing they represent only a fraction of the capital required to fuel AI growth. The halted $100 billion plan underscores the complexities and high stakes involved as tech giants race to dominate the rapidly evolving artificial intelligence landscape.
Also Read: Elon Musk Demands $134 Billion from OpenAI and Microsoft in Major Lawsuit
