Nvidia locks in $120 billion in AI deals with OpenAI, xAI and Intel
Nvidia has established over $120 billion in artificial intelligence partnerships with OpenAI, xAI, and Intel. These arrangements coincide with the company reporting strong financial performance and its stock trading near record levels, solidifying its position in AI infrastructure.
The most substantial of these collaborations is with OpenAI, involving a commitment of up to $100 billion. This funding is designated for the deployment of at least 10 gigawatts of Nvidia systems to build out the ChatGPT creator’s next-generation AI infrastructure. The investment structure is progressive, with Nvidia allocating funds as each gigawatt of capacity becomes operational. The initial phase of this deployment is scheduled for the second half of 2026 and will utilize Nvidia’s forthcoming Vera Rubin platform.
Further expanding its influence, Nvidia invested $2 billion in Elon Musk’s xAI. This contribution is part of a larger $20 billion funding initiative for the Colossus 2 data center located in Memphis. The financing was managed through a special-purpose vehicle, which combined $7.5 billion in equity with $12.5 billion in debt. This debt is secured by Nvidia’s graphics processing units (GPUs) rather than the corporate assets of xAI. In a separate move, Nvidia acquired a $5 billion stake in its competitor Intel, purchasing shares at $23.28 each. This purchase gives Nvidia an approximate 4% ownership and establishes a strategic alliance for the co-development of AI data-center and PC chips across multiple product generations, aiming to increase competition against AMD.
These strategic deals are accompanied by robust financial results for Nvidia’s second quarter of fiscal year 2026. The company reported total revenue of $46.7 billion, a 56% increase year-over-year. The data-center segment was the primary driver, generating $41.1 billion, which accounts for 88% of the total revenue. Gross margins were reported at 72.7%. The company’s stock value has increased by 86.9% over the last six months, with its market capitalization reaching approximately $4.4 trillion, making it the most valuable publicly traded company in the world. Shares currently trade in the $180 to $182 range, following a pullback from a record high of $195 in October.
Analyst sentiment remains highly positive, with more than 90% issuing a “buy” rating for the stock. Average price targets are in the $210 to $220 range. Despite the bullish outlook, some concerns have been noted, including the stock’s 50x forward price-to-earnings ratio and the potential impact of U.S.–China trade restrictions on its operations.
Disclaimer: The content of this article is for informational purposes only and should not be construed as investment advice. We do not endorse any specific investment strategies or make recommendations regarding the purchase or sale of any securities.
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