Nvidia Cuts OpenAI Ohio Data Center Guarantee to Under $120 Billion

Nvidia has scaled back its proposed financial backstop for OpenAI’s massive 10-gigawatt data center campus in Ohio, lowering its initial commitment from $250 billion to less than $120 billion amid investor anxiety over the chipmaker’s extensive financial exposure to artificial intelligence infrastructure.

Nvidia Slashes Ohio Data Center Backstop Guarantee

Nvidia has reworked the financial structure for a proposed data center campus in Ohio, shifting away from a massive multi-hundred-billion-dollar commitment. The chipmaker is now expected to initially guarantee less than $120 billion, down sharply from the $250 billion figure previously discussed with OpenAI.

The adjustment addresses growing investor apprehension regarding the company’s financial risk exposure. Nvidia has increasingly wielded its balance sheet to bolster demand for its artificial-intelligence hardware, prompting scrutiny over commitments that outpace immediate market returns.

Deal Nears Finalization Following Investor Concerns

The two companies are nearing a finalized agreement that would have Nvidia provide a financial backstop solely for the first phase of the massive undertaking.

Market reaction to the initial discussions was swift when the multi-hundred-billion-dollar backstop was first disclosed, with Nvidia shares falling 5% following the reporting. The revision directly targets those anxieties by cutting the initial exposure in half.

The Scope of the Ohio Infrastructure Project

Despite the scaled-back financial guarantee, the project remains staggering in scale. The 10-gigawatt campus in Ohio is being developed by SB Energy, a subsidiary of SoftBank, and is projected to become the largest data center project announced to date if completed. OpenAI is actively discussing a binding lease for the entire facility.

Earlier in the week, Nvidia partnered with six major financial institutions to launch compute financing platforms aimed at raising over $500 billion in third-party capital for AI infrastructure.

Financial Scrutiny Surrounding OpenAI

OpenAI’s ambitious expansion comes while the company remains unprofitable, even as it commands an $852 billion valuation.

Photo: Reuters

While the Ohio project is designed to help OpenAI secure long-term control over its computing resources, the total buildout could cost more than $500 billion if completed in full.