Nvidia Forms Financial Partnerships to Fuel AI Factory Boom

Nvidia Forms Financial Partnerships to Fuel AI Factory Boom

Nvidia has partnered with six financial institutions to establish independent compute platforms designed to mobilize over $500 billion of third-party capital for the buildout of artificial intelligence infrastructure, the company said in a Monday (Aug. 10) press release.

The firms with which the AI chip manufacturer has announced these strategic partnerships are Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs and KKR. The partnerships remain subject to the execution of final agreements, according to the release.

The compute financing platforms will be established at global scale, and the partnerships will see Nvidia work with the firms to create dedicated pools of capital at scale at attractive rates for Nvidia customers, the release said.

Nvidia Founder and CEO Jensen Huang said in the release that AI factories are “a new class of productive, investable architecture,” that in AI, “compute is revenue” and that Nvidia compute is suited for this role because it is broadly adopted, flexible, fungible and transferable.

“That is why we are bringing the world’s leading long-term capital providers together to independently underwrite AI infrastructure,” Huang said. “These financing platforms will help customers access scare compute at scale and build the DSX AI factories that will power every industry and country in the age of AI.”

Huang said during a May earnings call that AI infrastructure spending could reach $3 trillion to $4 trillionannually by the end of the decade. Hyperscaler capital expenditure on AI alone is forecast to exceed $1 trillionin 2027.

“Compute is revenues. Compute is profit,” Huang said during the call.

Nvidia said in its State of AI reports released in March that AI is delivering measurable financial gains for businesses. The reports found that 88% of organizations said AI has increased their annual revenue, while 87% reported cost reductions.

It was reported in July that the five companies spending the most on AI data centers in the United States doubled their debt load over the past five years to finance their efforts. In total, Alphabet, Amazon, Meta, Microsoft and Oracle added about $350 billion to their debt obligations.

It was reported Wednesday (Aug. 5) that Apollo named a new leader to head AI-related deals as part of a larger strategy to capture more digital infrastructure deals.