Nvidia, Wall Street banks raise $500bn for AI compute
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- Nvidia teamed up with Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs and KKR to raise $500bn (£370bn) in capital for AI infrastructure, with the financing going toward Nvidia's own projects and those of its partners.
- Jensen Huang, Nvidia's chief executive, said "In AI, compute is revenue" and described the initiative as the creation of "a new class of productive, investable infrastructure: AI factories."
- The Wall Street investors are for the first time treating AI hardware and infrastructure — often called "compute" — as a formal asset class, with Apollo president Jim Zelter calling modern compute "a scarce, mission-critical asset class."
- Major tech companies using Nvidia's chips — including Google, Meta, Amazon, Microsoft, SpaceX, Tesla, OpenAI and Anthropic — have collectively spent over $1tn in just three years on AI projects and infrastructure.
- Jane Sydenham, senior investment manager at Rathbones, warned that "more and more money is going into these projects" and questioned whether they will all "earn the right return for the future."
- Demand for Nvidia's GPUs has driven the company's stock market value up fivefold in three years, and the new financing is meant to back new data centers and chip factories to expand capacity.
Why it matters: Six of Wall Street's largest lenders and asset managers — including Apollo, BlackRock and KKR — are now formally underwriting AI compute as a new asset class, opening a dedicated funding channel for Nvidia and chip buyers like Google, Meta, Microsoft, OpenAI and Anthropic beyond the $1tn already committed in three years. Rathbones' Jane Sydenham publicly questioned whether the flood of capital into these projects will earn adequate returns, putting a named skeptic's voice directly against the deal's bullish framing.
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