Nvidia is in talks to guarantee roughly $250 billion in financing for an OpenAI data center project, the Wall Street Journal reported Sunday in an exclusive. CNBC, citing a source, also reported that Nvidia would back the buildout.
The arrangement described in the reports is a backstop rather than a straight investment: Nvidia would stand behind the debt so that OpenAI can lease the site. According to the Deccan Chronicle, the project is a 10-gigawatt campus in southern Ohio being developed by SoftBank's energy subsidiary, a figure Data Center Dynamics also reported. Firstpost described OpenAI as close to leasing a 1 GW Ohio facility, so the scale being cited varies across outlets.
Markets reacted fast and unevenly. Nvidia stock fell 5%, per Benzinga, and 24/7 Wall St. and Yahoo Finance reported a broader slide in AI names. Yahoo Finance also reported that Nvidia's credit risk jumped in the swaps market — the place where investors price the odds a company runs into trouble paying its debts. Not everyone lost: Yahoo Finance noted that cloud providers CoreWeave and Nebius gained on the news.
The unease has a name. Axios reported the talks reignite concerns about "circular" AI financing — the worry that the chipmaker selling the hardware is also underwriting the customer buying it, so demand and the money funding that demand come from the same place. Barron's framed the question investors are now asking: what a deal this size means for Nvidia's own stock.
None of the parties have confirmed a final agreement; every account so far is sourced reporting.
Why it matters: a guarantee of this size would tie the most valuable company in the AI trade directly to its biggest customer's debts, and investors just signaled they are not sure that is a strength.