Nvidia reduces investment in OpenAI to 30 billion, goodbye to 100 billion deal
The Financial Times writes that the two companies are abandoning the multi-year agreement announced last September
Key points
Concluded agreements are one thing, agreements announced but never finalised are quite another. This is how one could describe what is happening between OpenAI and Nvidia, protagonists of one of the most ambitious financial announcements of the last year in the artificial intelligence sector and today grappling with a significant downsizing of that agreement.
According to Ft. Ft. reports, Nvidia is close to finalising a $30 billion investment in the Sam Altman-led group, which will replace the larger $100 billion multi-year commitment announced with great fanfare last September in the form of a letter of intent. The new investment is part of an overall round in excess of $100 billion and would give the ChatGPT company a valuation of around $730 billion pre-money.
The original agreement provided for an articulated mechanism: ten tranches of 10 billion each, disbursed progressively according to the growth in demand for the computing power of OpenAI. In parallel, the artificial intelligence company committed to purchase millions of Nvidia processors to support up to 10 gigawatts of new computing capacity. A close industrial alliance, capable of welding supplier and customer in a long-term structural relationship.
However, that understanding never moved from the declaratory to the contractual dimension. It was not transformed into a definitive agreement and, in fact, remained at the memorandum stage. Already in recent months, Il Sole 24 Ore had described the phenomenon of billion-dollar maxi-agreements in the Ai sector, emphasising how many of them, although announced with great media prominence, did not automatically translate into binding obligations. The Nvidia-OpenAI case now seems to confirm this dynamic.
A strategic change
The change from 100 to 30 billion is not only a quantitative reduction, but a qualitative change. The new scheme appears more linear: a direct equity investment, without the multi-year architecture and without the tranches contingent on future growth in computing demand. Nvidia becomes a major strategic investor, but is no longer tied to an obligatory and progressive path of financial commitment.
