Blackstone, BlackRock Are In! NVIDIA Teams Up with Wall Street to Raise $500 Billion AI War Chest

Foreign media reported on Monday (10th), citing sources familiar with the matter, that NVIDIA (NVDA-US) is in discussions with several major Wall Street investment firms to provide up to $500 billion in financing for artificial intelligence (AI) infrastructure development. The agreement could be announced as early as Monday.

Institutions involved in the talks include Apollo Global Management, Blackstone Group (BX-US), BlackRock (BLK-US), Brookfield Asset Management, Goldman Sachs, and KKR. The relevant companies either declined to comment or have not yet responded to requests for comment. The UK's Financial Times (FT) had earlier reported on this financing plan.

However, it remains unclear which companies or projects the $500 billion will support, what form the financing will take, and whether the amount represents new commitments or includes previously announced investments.

Following the news, NVIDIA's stock continued to decline, falling 2.2% to $219.01 by 1:32 p.m. New York time on Monday.

In recent months, NVIDIA has accelerated its investments and partnerships with tech and AI companies, signing deals worth hundreds of billions of dollars within the AI ecosystem. However, some investors worry that NVIDIA's funding of customers to build data centers and purchase its own chips could create a 'circular transaction,' artificially inflating demand for AI chips and industry valuations.

Bloomberg reported last month that NVIDIA is discussing providing up to $250 billion in financing guarantees to help OpenAI lease computing power from a U.S. data center project. The project, developed by SB Energy, a subsidiary of SoftBank Group, in Ohio, involves an investment of about $500 billion and a power capacity of 10 gigawatts. At the time, NVIDIA was also said to be considering providing around $350 billion in financing for OpenAI to purchase its chips.

In addition to OpenAI, NVIDIA last month expanded its partnership with South Korea's SK Group, stating that future business dealings between the two would exceed $500 billion. NVIDIA has also made a 'significant' investment in Safe Superintelligence, an AI startup co-founded by former OpenAI chief scientist Ilya Sutskever.

If Wall Street giants join the financing, it will provide more capital for the global expansion of AI data centers, but it may also deepen market concerns about NVIDIA simultaneously acting as a chip supplier, investor, and financier for its customers.