Wall Street just endorsed Jensen Huang's 'big concept' for AI. What now?
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- Jensen Huang appeared on CNBC with leaders from Goldman Sachs, BlackRock, Blackstone, KKR, Apollo and Brookfield to announce the firms would raise $500 billion—and potentially more—for new AI factories, calling AI infrastructure "a new asset class"
- Nvidia secured the option to backstop 25% of every loan made through the arrangement, while requiring borrowers to use Nvidia-specified system architectures that would let another company take over operations "if something were to happen"
- Alphabet, Amazon, Meta, Microsoft and Oracle have already raised well over $150 billion combined this year selling debt and equity for data centers, with Intel alone upsizing a recent stock offering to $20 billion
- McKinsey projects global AI infrastructure outlays will reach $7 trillion by the end of the decade, the figure that shaped Monday's pledge
- BlackRock's Larry Fink drew a direct comparison to the early mortgage-backed securities market of the 1970s, calling AI infrastructure "a next future for financial engineering," while Apollo's Jim Zelter acknowledged "there will be excesses, there will be pullbacks"
- Nvidia's nearly year-old $100 billion OpenAI partnership for a 10-gigawatt data center buildout never materialized, though Nvidia later contributed $30 billion to OpenAI's record funding round earlier this year
- The deal was backed by memos of understanding rather than contracts, and the CNBC panel was "thin on specifics" regarding borrower types, interest rates, facility locations or timelines
Why it matters: The arrangement shifts AI infrastructure financing off tech-company balance sheets—already $150 billion-plus in debt and equity this year—into broader capital markets, where Wall Street can securitize GPU-backed systems. Nvidia retains the right to backstop 25% of every loan and to dictate borrower hardware, concentrating operational control in a single supplier even as Larry Fink invoked the early mortgage-backed securities market and Jim Zelter conceded "there will be excesses."
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