Nvidia nears $30 billion OpenAI stake as original $100 billion mega-deal is scrapped

Nvidia is nearing the finalization of a $30 billion investment in OpenAI as part of a massive new funding round for the artificial intelligence pioneer.

According to sources familiar with the matter who spoke to the Financial Times, the world’s most valuable company is in the final stages of negotiations with OpenAI, and the investment could be completed as early as this weekend.

The $30 billion capital injection is part of a broader financing round aiming to raise more than $100 billion. This round would value the ChatGPT creator at $730 billion, excluding the new funds.

OpenAI is expected to reinvest the vast majority of this fresh capital back into Nvidia hardware. However, the companies will not be moving forward with the $100 billion multi-year investment partnership they announced in September.

The retreat from that high-profile agreement, which was initially met with significant fanfare, comes as investors grow increasingly concerned over the health of the AI sector. Such anxieties have contributed to a 17% decline in US tech stocks since the beginning of the year.

The original deal, announced last year as a “letter of intent,” tightly linked the two companies at the heart of the AI boom and helped propel Nvidia’s market capitalization past the $5 trillion threshold just weeks later.

That announcement accelerated a period of frantic deal-making for OpenAI CEO Sam Altman, as the startup forged complex agreements with rival chipmakers AMD and Broadcom, as well as cloud providers like Oracle.

While initially welcomed by equity markets, the proliferation of “circular” deals—whereby suppliers, customers, and investors are interconnected—has sparked warnings among some analysts regarding the potential for an industry bubble.

Under the terms of the original $100 billion proposal, Nvidia was to invest an additional $10 billion in the startup in exchange for a significant equity stake, as OpenAI’s demand for computing power was projected to surge over several years.

In turn, OpenAI planned to purchase millions of Nvidia’s AI processors as part of an ambitious roadmap to establish up to 10 gigawatts of new computing capacity.

However, the memorandum of understanding never progressed to a formal contract. In January, the Wall Street Journal reported that the deal had been “put on ice.”

The arrangement has now been replaced by a more streamlined structure in which Nvidia will invest up to $30 billion in exchange for OpenAI shares.

Sources close to the companies indicate that these funds will support the development of gigawatts of new computational capacity, with additional agreements likely to follow over time.

Altman and Nvidia CEO Jensen Huang have sought to dismiss reports of a cooling relationship between their respective firms.

“We love working with Nvidia; they build the best AI chips in the world. We expect to be a massive customer for a long time,” Altman posted on X earlier this month.

The following day, Nvidia’s chief executive told CNBC that claims of a rift were “absurd,” adding, “We love working with OpenAI.”

The San Francisco-based startup is also in advanced talks with SoftBank. According to sources close to the negotiations, SoftBank is set to invest $30 billion, while Amazon may contribute up to $50 billion as part of a broader partnership involving the use of OpenAI models.

Abu Dhabi’s state-backed technology investment fund, MGX, and Microsoft are also expected to commit billions of dollars. OpenAI executives are scheduled to meet with venture capitalists and other investors this week to further drum up interest.

During these meetings, OpenAI informed investors of plans to spend approximately $600 billion on computing resources—including hardware and services from Nvidia, Amazon, and Microsoft—by 2030.

The company maintains that securing access to vast computing resources is its primary defense against competitors. Executives are aggressively moving to secure as much infrastructure and electrical power as possible to meet what they describe as limitless demand for AI tools.

OpenAI’s revenue surpassed a $20 billion annual run rate earlier this year—a metric favored by startups that reflects projected revenue for the coming year.

Revenue growth has closely mirrored the company’s expanding access to computing power, roughly tripling on an annual basis.