NVIDIA CEO Jensen Huang delivers a speech during a keynote event at COMPUTEX on June 2, 2026 in Taipei, Taiwan. Cheng Chia Huang | Getty Images Nvidia’s enormous advantage in artificial intelligence made the chipmaker the most valuable company in the world. Now, nearly four years into the rise of generative AI, competitors like Advanced Micro Devices and Google have eroded Nvidia’s technological leadership, pushing the company to leverage its other great asset: capital. Following last week’s pact with Wall Street firms to seek $500 billion in financing for Nvidia’s graphics processing units, Nvidia said Monday it will provide up to $105 billion for a giant OpenAI data center in Ohio, offering a backup of sorts in case ChatGPT’s creator sees its fortunes change. For Nvidia, the strategy involves fueling the AI boom by any means necessary, recognizing that demand for critical infrastructure is seemingly insatiable but that a handful of companies (the hyperscalers) represent an enormous amount of purchases. With its quarterly free cash flow increasing 18-fold over the past three years to $48.5 billion in the latest period, Nvidia is using the strength of its balance sheet and credit rating to ensure there is no dramatic slowdown after 12 consecutive quarters of more than 55% revenue growth. “They’re still dominant, but they’re very paranoid about making sure they don’t lose ground,” said Ram Bala, an associate professor of AI and analytics at Santa Clara University’s Leavey School of Business. Nvidia declined to comment. In a note to clients on Monday, Cantor analysts downplayed concerns that Nvidia is effectively buying revenue through its financial maneuvers. They reiterated their buy rating and said the latest deal is a “clear sign that the current AI investment cycle will be long and lasting.” “We view this as less circular and more enabling of upcoming AI development, while at the same time creating additional competitive moats that will continue to allow NVDA to remain THE leader in AI,” the analysts wrote. Nvidia is swimming in money. Its cash generation is so great that the company said in May it was raising its quarterly dividend from one cent to 25 cents per share and announced a new $80 billion share buyback plan. The company pledged to “return approximately 50% of free cash flow to shareholders this year.” One way the company has been putting its cash to work is through equity investments in companies across the AI ecosystem, including some companies, such as model developers and neoclouds, that spend heavily on Nvidia chips and systems. Nvidia had $30.2 billion in marketable securities in the latest quarter, up from $12.9 billion a year earlier. In February, Nvidia invested $30 billion in OpenAI, which relies on the training capabilities of Vera Rubin, the chip giant’s most advanced system. Monday’s deal included a $1.5 billion investment in SB Energy, a SoftBank affiliate that is building and managing the data center at the PORTS-Pike technology campus in Pike County, Ohio, through a 20-year lease to OpenAI. In addition to the investment in SB Energy, Nvidia said it is putting its financial support behind about 4 gigawatts of development at the Ohio site for portions of the lease and power and “a targeted residual value commitment” as the data centers open between 2028 and 2030. Expanding Access Nvidia CEO Jensen Huang acknowledged the importance of the company’s financial prowess in a post on X about the deal. “Frontier’s AI labs have extraordinary demand for training and inference computing, but many are growing faster than their balance sheets and long-term credit profiles can support,” Huang wrote. “They may have strong customer demand and rapidly growing revenue, but they still lack decades-long infrastructure contracts and the investment-grade financing capacity needed to independently secure AI factory infrastructure.” A week earlier, Huang was on the CNBC set surrounded by six of Wall Street’s top financiers to announce the arrival of Nvidia’s graphics processing units as a new asset class. Signing a memorandum of understanding with companies including Goldman Sachs, Apollo Global Management, Blackstone and BlackRock, Huang indicated that the next phase of AI development will be funded in part by third-party sponsors, who can begin investing in GPUs the same way they do in real estate. “These are income-generating assets now,” Huang told CNBC. “They are productive, durable, fungible and flexible.” The key to obtaining financing for potential borrowers will be dedication to Huang’s systems, with Nvidia having the option to back 25% of each loan. It’s another way to bring more Nvidia technology to market, as competition increases from Google and AMD, as well as specialized chipmakers like Cerebras. In the second quarter, Google began recognizing revenue from sales of TPU systems, which contributed to the cloud unit’s 82% growth. Meanwhile, AMD reported more than 100% growth in its data center business and the company expects its first rack-scale system, called Helios, to ship later this year. Paul Meeks, head of technology research at Freedom Capital Markets, said intensifying competition hurts Nvidia’s ability to generate “outrageous margins” and encourages the company to diversify its strategy. “Part of their thinking is to expand our reach,” Meeks said. “We just can’t ride this horse, which is GPUs.” AI advocates say Nvidia is simply responding to demand and point out that the shortage in the current market is on the capacity side. There are plenty of numbers to back that up, as Anthropic told investors over the weekend that its annualized revenue run rate hit $65 billion in July, up seven times from a year ago. OpenAI’s run rate recently reached $40 billion. Matthew Vegari, head of research at Clearwater Analytics, said in an email that based on market dynamics, the “narrative around the devious ‘house of cards’ structure of AI trading seems somewhat misguided to us.” “We could one day have excess capacity,” he wrote. “But that day is not today.” — CNBC’s Samantha Subin and Jonathan Vanian contributed to this report WATCH: AI isn’t a new asset class, it’s the entire market, says Clockwise Capital CIO. Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.
