A golden age for AI, built on a mountain of other people's money and Nvidia's chips. #
Nvidia is expanding its role in financing artificial intelligence infrastructure through a series of agreements spanning South Korea and the United States, reinforcing a strategy that has prompted renewed debate among investors over vendor financing and concentration risk across the rapidly growing AI sector.
The latest announcements include a more than $500 billion business partnership with South Korea's SK Group and discussions surrounding financing arrangements linked to a proposed $500 billion OpenAI-led data centre project in Ohio.
Taken together, the initiatives highlight Nvidia's increasingly important role not only as the dominant supplier of AI processors but also as a financial partner helping customers build the infrastructure required to deploy them.
Nvidia Deepens Partnership With SK Group #
Nvidia and SK Group announced a long-term partnership expected to generate more than $500 billion in business between the companies.
The agreement includes plans to develop more than 2 gigawatts of AI data centre capacity in South Korea, with SK Telecom expected to open the first facility next year.
According to Nvidia, the partnership will also expand collaboration on next-generation high-bandwidth memory (HBM), a critical component for AI accelerators that remains in exceptionally high demand.
Nvidia chief executive Jensen Huang described the agreement as a significant opportunity for South Korea's technology sector.
'This is the golden age for Korea,' Huang told Bloomberg Television, adding that the country's semiconductor industry is well positioned to help build global AI infrastructure.
The projected value of the partnership reflects both Nvidia's planned purchases of memory products from SK Hynix and SK Group's expected investment in Nvidia-powered AI systems.
Vendor Financing Draws Increased Scrutiny #
The announcement comes as investors continue examining Nvidia's growing involvement in financing customers that subsequently purchase its hardware.
Some analysts have described the trend as an example of vendor financing, in which suppliers help fund projects that generate future demand for their own products.
Gary Tan, portfolio manager at Allspring Global Investments, said capital is increasingly being deployed to support future AI customers and infrastructure developments, raising questions about the degree of interconnected financing across the industry.
Supporters argue such arrangements accelerate deployment of AI infrastructure during a period of exceptionally strong demand for computing capacity.
Critics, however, caution that increasing financial interdependence between chip suppliers, AI developers and infrastructure operators could amplify risks if demand slows or financing conditions tighten.
OpenAI, Softbank and the Ohio AI Megaproject #
Nvidia is also reportedly discussing financing arrangements connected to a proposed 10-gigawatt AI campus in Ohio being developed through a SoftBank subsidiary for OpenAI.
According to people familiar with the discussions, Nvidia is considering providing guarantees of up to $250 billion to support leasing arrangements for the project.
Separate discussions reportedly include financing of as much as $350 billion for OpenAI's purchases of Nvidia hardware intended for the same facility.
Neither Nvidia, OpenAI nor SoftBank has publicly confirmed the reported discussions.
If completed, the arrangements would represent one of the largest examples of vendor-supported financing within the AI industry. Analysts say guarantees from Nvidia could improve access to financing by reducing perceived lending risks for infrastructure partners.
Investment strategist Billy Leung of Global X Management said expanded vendor financing illustrates both the enormous capital requirements associated with AI infrastructure and the growing financial links between suppliers and customers.
SoftBank has already committed approximately $65 billion in investments related to OpenAI, supported in part by a $40 billion bridge loan, reflecting the scale of capital now flowing into AI infrastructure.
Cross-Investment Raises Broader Industry Questions #
Nvidia's financing strategy forms part of a wider trend across the AI sector.
Major technology companies have increasingly combined infrastructure investment, equity stakes and commercial agreements as competition intensifies.
Google has entered infrastructure agreements supporting Anthropic, developer of the Claude family of AI models, while Microsoft continues investing heavily in OpenAI. Amazon has also committed billions of dollars to Anthropic while supplying cloud infrastructure through AWS.
Nvidia has likewise invested in several AI-related businesses, including CoreWeave, Nebius Group, IREN and Marvell Technology, alongside broader infrastructure partnerships.
According to public announcements, Nvidia has disclosed more than $540 billion in financing and investment commitments this year, excluding the reported Ohio discussions.
Analysts note that these increasingly interconnected commercial relationships create both opportunities and risks.
Supporters argue they accelerate AI deployment and strengthen supply chains during a period of exceptional demand.
Others caution that greater financial interdependence could expose the sector to wider disruptions should AI spending slow, project economics weaken or credit markets tighten.
Huang has previously rejected suggestions that Nvidia's investments artificially stimulate demand for its products.
Speaking earlier this year about Nvidia's investment in CoreWeave, Huang said Nvidia's contribution represented only a small proportion of the capital ultimately raised by the company, adding that characterisations of the arrangements as "circular" financing were "ridiculous."
Separately, Nvidia also announced a $1 billion investment in Naver to support construction of a new AI data centre in South Korea alongside Brookfield. The project, which will operate using Nvidia hardware, prompted Naver shares to rise more than 8% in Seoul following the announcement.
As AI infrastructure spending continues accelerating worldwide, investors are expected to remain focused on whether increasingly complex financing arrangements can sustain long-term growth while limiting concentration and financial risk across the sector.
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