Nvidia has announced plans to establish a $500 billion investment fund in collaboration with major Wall Street financial institutions to support artificial intelligence (AI) infrastructure. This fund aims to provide financing to customers looking to purchase Nvidia products, including graphics processing units (GPUs), although concerns about circular trading have been raised.
On August 10, Jensen Huang, CEO of Nvidia, stated in a release that the company will create a large pool of funds with six financial institutions: Goldman Sachs, BlackRock, Blackstone, Apollo Global Management, Brookfield Asset Management, and KKR. He emphasized that this financial platform will enable customers to secure the necessary computing resources on a large scale and build AI factories that will drive industries and nations in the AI era.
During an appearance on CNBC with representatives from the six financial institutions, Huang revealed that partnerships have been established with each of them. He noted, "We are in a unique time where the computer industry is experiencing a fundamental platform change for the first time in 60 years. Computers have become part of the infrastructure, just like electricity and the internet. Therefore, we must consider computers as part of the infrastructure and build accordingly."
Huang agreed with the host's comment about the significant costs associated with building data centers, stating, "It costs about $50 to $60 billion per gigawatt." He added that the partnerships formed will support the overall ecosystem development.
This initiative comes amid a global AI boom, with companies planning to invest in AI infrastructure such as data centers, suggesting that this fund will be beneficial for those enterprises.
However, Bloomberg pointed out that despite the staggering figure of $500 billion, there was little detail regarding the timing, structure of the financial support, or how it differs from similar agreements Nvidia has previously made. Nvidia has already entered into similar contracts worth hundreds of billions with other companies across the AI ecosystem, raising concerns about circular trading, where companies purchasing GPUs from Nvidia receive investments and funding from the company, potentially resulting in no real profit.
In fact, the news of Nvidia's $500 billion investment with the six financial institutions was first reported by the Financial Times. Following the announcement, Nvidia's stock closed down 2.86% on the New York Stock Exchange on August 10.
* This article has been translated by AI.
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