🚨 BREAKING: Nvidia just cut its OpenAI data center guarantee by more than half.
Important details:
1: The backstop for OpenAI's Ohio data center is going from $250 billion down to under $120 billion. The Information says the final number could land closer to $100 billion.
2. It now only covers the first phase of the 10 gigawatt campus, roughly half the project, instead of the whole build.
3. Investors pushed back hard. When the original $250 billion was reported, Nvidia stock dropped 5%. That figure was about a quarter of their entire market cap.
4. The site is in Pike County, Ohio, on Department of Energy land that used to be a uranium enrichment facility. SoftBank's SB Energy is building it. Largest data center project announced anywhere.
5. Total cost could pass $500 billion once you add the GPUs and the rest of the infrastructure.
6. A separate chip financing package worth up to $350 billion is still being negotiated alongside it.
7. First phase is around 800 megawatts, targeted for 2028. OpenAI still hasn't signed a binding lease for the full 10 gigawatts.
8. OpenAI is also an investor in SB Energy, the company developing the site.
9. Power is mostly natural gas, 9.2 gigawatts of new generation. Japan put in $33 billion as part of a trade deal, and the US government will reportedly pay SB Energy to operate it.
10. On Monday Nvidia announced compute financing platforms with six banks, targeting over $500 billion in outside capital.
What it means: Nvidia was about to guarantee the debt on a data center whose whole purpose is buying Nvidia chips.
Demand isn't slowing, but there's now a visible ceiling on how much risk they'll carry alone.
Worth remembering OpenAI is valued at $852 billion and still isn't profitable.
$NVDAB $OPENAI $BICO
Important details:
1: The backstop for OpenAI's Ohio data center is going from $250 billion down to under $120 billion. The Information says the final number could land closer to $100 billion.
2. It now only covers the first phase of the 10 gigawatt campus, roughly half the project, instead of the whole build.
3. Investors pushed back hard. When the original $250 billion was reported, Nvidia stock dropped 5%. That figure was about a quarter of their entire market cap.
4. The site is in Pike County, Ohio, on Department of Energy land that used to be a uranium enrichment facility. SoftBank's SB Energy is building it. Largest data center project announced anywhere.
5. Total cost could pass $500 billion once you add the GPUs and the rest of the infrastructure.
6. A separate chip financing package worth up to $350 billion is still being negotiated alongside it.
7. First phase is around 800 megawatts, targeted for 2028. OpenAI still hasn't signed a binding lease for the full 10 gigawatts.
8. OpenAI is also an investor in SB Energy, the company developing the site.
9. Power is mostly natural gas, 9.2 gigawatts of new generation. Japan put in $33 billion as part of a trade deal, and the US government will reportedly pay SB Energy to operate it.
10. On Monday Nvidia announced compute financing platforms with six banks, targeting over $500 billion in outside capital.
What it means: Nvidia was about to guarantee the debt on a data center whose whole purpose is buying Nvidia chips.
Demand isn't slowing, but there's now a visible ceiling on how much risk they'll carry alone.
Worth remembering OpenAI is valued at $852 billion and still isn't profitable.
$NVDAB $OPENAI $BICO