Nvidia to invest $100bn in OpenAI

Deal may see the sale of 4-5 million chips

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Nvidia, the world's most valuable publicly traded company, said Monday that it would invest $100 billion in OpenAI, a deal that will allow the startup behind Chat-GPT to use the chipmaker's artificial intelligence semiconductors inside its data centres.

Nvidia's investment in OpenAI is part of a wider effort among tech companies to spend hundreds of billions of dollars on AI data centres around the world. OpenAI, Amazon, Google, Meta and Microsoft plan to spend more than $325 billion combined on these facilities by the end of the year.

Tech industry giants, which pull in tens of billions of dollars in profits yearly, have been able to finance much of this construction with the money they have in the bank. But as newer, smaller companies like OpenAI have built facilities, they have been forced to raise or borrow tens of billions of dollars.

This has led many experts to worry that if AI technologies are not adopted as quickly as these companies believe they will be, that aggressive spending could put companies in a precarious situation. Many could find themselves shouldering big debts without having sufficient sales to cover their costs.