Nvidia to Invest $100B in OpenAI

Nvidia Corp. will invest as much as $100 billion in OpenAI to support new data centers and other artificial intelligence infrastructure, a blockbuster deal that underscores booming demand for AI tools like ChatGPT and the computing power needed to make them run.

The companies announced the agreement Monday, saying they’d signed a letter of intent for a strategic deal. The investment is meant to help OpenAI build data centers with a capacity of at least 10 gigawatts of power — equipped with Nvidia’s advanced chips to train and deploy AI models.

Investors applauded the tie-up, sending Nvidia shares up as much as 4.5% in New York trading. The shares have now gained about 36% this year, cementing the company’s status as the most valuable business on Earth. OpenAI, meanwhile, is the world’s biggest tech startup, with a valuation of $500 billion. Bloomberg's Michael Shepard reports.

The companies are helping lead a global push to build data centers for a new generation of AI tools — an undertaking that is expected to cost trillions of dollars in total. The effort requires advanced chips, servers, cooling systems and enormous amounts of electricity.

“This investment and infrastructure partnership mark the next leap forward — deploying 10 gigawatts to power the next era of intelligence,” Nvidia Chief Executive Officer Jensen Huang said in a statement.

Nvidia will receive equity in OpenAI as part of the deal, according to people familiar with the arrangement. The investment will be provided in stages, with the first $10 billion coming when the deal is signed, the people said, who asked not to be identified because the talks were private. Further increments will follow when each gigawatt of computing power is deployed.

Nvidia has been using its financial might to make sure the company’s technology remains at the heart of AI systems. With the OpenAI deal, it’s strengthening ties with a vital ally. The startup makes the market-leading chatbot and is working to expand its own AI infrastructure. The agreement signals that OpenAI will remain a key Nvidia customer, even as the company seeks other suppliers.

Nvidia also has positioned itself as a champion of domestic technology infrastructure — a priority of the Trump administration. The Santa Clara, California-based chipmaker has been working to build goodwill with the White House at a time when it needs Washington to ease China export restrictions.

Last week, Nvidia agreed to invest to $5 billion in Intel Corp., the long-struggling chipmaker that is now partially owned by the US government.

On Monday, OpenAI CEO Sam Altman said the Nvidia deal would lead to new AI breakthroughs by securing the necessary computing power.

“Everything starts with compute,” he said in the statement. “Compute infrastructure will be the basis for the economy of the future.”

OpenAI’s ChatGPT is used by roughly 700 million people weekly and takes an intensive amount of computing power to service and build its products. In the past, the company has faced computing constraints in its ability to meet customer demand, particularly around new releases. On Sunday, Altman posted on social media that his company will be launching some new “compute-intensive” product offerings in the next few weeks.

Nvidia and OpenAI didn’t provide details on its investment in OpenAI or when it would occur. Representatives for Nvidia declined to comment.

In the statement, the companies said they “look forward to finalizing the details of this new phase of strategic partnership in the coming weeks.”

The deal is the latest big-budget data center agreement to be announced this year. OpenAI and Oracle Corp. forged a partnership to build 5 gigawatts of data center capacity, including a facility under construction in Abilene, Texas, as part of a projected branded as Stargate.

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