Nvidia has pledged up to $100 billion to OpenAI, mostly to buy Nvidia hardware for AI workloads. The move came after Nvidia’s recent $5 billion deal with Intel and continues a pattern of investing in companies that heavily use its own technology. The deal starts with $10 billion and scales as OpenAI deploys more computing power.
OpenAI plans to use this investment to build AI infrastructure capable of handling the next generation of AI models. Nvidia CEO Jensen Huang described it as the “biggest AI infrastructure project in history.” The investment has an immediate market impact, pushing Nvidia’s value up by $220 billion. It shows how strategic partnerships in AI are driving both tech growth and investor confidence.
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The Circular Investment Scheme
The deal uses a circular structure. Nvidia buys non-voting shares in OpenAI, and OpenAI spends most of the money on Nvidia systems. This creates steady demand for Nvidia hardware while supporting OpenAI’s AI expansion. Analysts note that the structure may attract antitrust attention since it consolidates Nvidia’s influence over AI computing.
Nvidia already has similar deals with CoreWeave and nScale, and this latest agreement reinforces its position in the AI hardware ecosystem. The partnership is focused on developing data centers with the new Vera Rubin platform, designed to run powerful AI models efficiently. By aligning investment with hardware supply, Nvidia ensures long-term demand for its chips.
What about the data centers?
The first data centers under this deal are expected online in 2026. They will require about 10 gigawatts of power, enough to supply 8 million US homes. OpenAI’s Sam Altman explained that this capacity is essential for improving AI models and scaling operations. The infrastructure will allow OpenAI to train larger language models and run advanced AI research without depending on hyperscalers like Google or Microsoft.
Ofcourse, Nvidia hardware will be at the center, powering everything from GPUs to AI optimization systems. What we can see from this is that there is huge demand for AI related computation and Nvidia currently has the ability to enable it at scale.
The impact on the market
Nvidia’s stock jumped immediately following the announcement, adding $220 billion to market value. The move shows investor confidence in AI-driven growth. Other companies are taking notice, with competitors exploring similar partnerships. By locking in AI workloads, Nvidia is strengthening its lead over AMD, Intel, and other chipmakers. Analysts warn that consolidation in AI infrastructure may trigger regulatory scrutiny. Still, the market is betting that Nvidia’s strategy will pay off, with AI hardware demand expected to grow steadily over the next few years.
