Nvidia, currently the globe’s most valuable publicly traded company, announced on Monday a groundbreaking $100 billion investment in OpenAI. This monumental deal will enable the innovative San Francisco-based startup, renowned for creating ChatGPT, to integrate Nvidia’s cutting-edge artificial intelligence semiconductors into its vast data centers.
This substantial investment highlights a recurring pattern where OpenAI secures funding directly from its key technology providers. For instance, Microsoft, after its initial $10 billion investment in OpenAI in 2023, has already seen billions in returns as OpenAI heavily utilizes its Azure cloud computing services.
It’s worth noting that Nvidia also invested in OpenAI last year. Jensen Huang, Nvidia’s Chief Executive, revealed on CNBC that his company is committed to facilitating the largest data center expansion ever conceived. This ambitious undertaking is expected to lead to the sale of an astonishing four to five million Nvidia chips to OpenAI.
This latest financial injection from Nvidia is distinct from OpenAI’s ongoing funding round, which is being spearheaded by the Japanese tech and investment powerhouse, SoftBank. That particular fundraising initiative is projected to channel an additional $40 billion into the AI startup, potentially pushing its valuation to an astounding $300 billion. Other prominent investors in this round include Microsoft, Thrive Capital, Coatue, and Altimeter.
Furthermore, OpenAI is reportedly in discussions to facilitate the sale of $6 billion worth of shares held by its current and former employees. If this transaction goes through, it would remarkably place the company’s valuation at approximately $500 billion.
Earlier in January, OpenAI, alongside its partners SoftBank and cloud computing titan Oracle, publicly unveiled plans with former President Trump to invest an staggering $500 billion in constructing new data center infrastructure across the United States. This ambitious undertaking, dubbed ‘Project Stargate,’ has already seen the establishment of a data center in Abilene, Texas, with more facilities planned for various locations nationwide.
(A relevant note: The Times initiated a lawsuit against OpenAI and Microsoft in 2023, alleging copyright infringement concerning the use of its news content by their AI systems. Both companies have refuted these claims.)
Please note: This is an evolving news story, and we will provide further updates as they become available.