Nvidia Weighs Nscale Construction Debt Guarantee — SkimNews
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- Nvidia is in talks to guarantee billions in debt financing for Nscale’s planned Anthropic data center in West Virginia, a proposal first reported by The Information and later corroborated by Bloomberg.
- Under a proposed residual value guarantee, Nvidia would step in if Nscale defaulted on construction payments, temporarily take over the West Virginia facility and help find a buyer and new tenant; Nvidia’s earlier support mostly covered leases and chip purchases, not construction.
- Nvidia has extended roughly $170 billion in investments and credit support to neoclouds and large customers, including $1 billion in convertible financing committed to Nscale in September.
- Anthropic signed a $44.6 billion contract for Nscale’s first 460-megawatt building in West Virginia, expected to use Nvidia’s next-generation Vera Rubin chips; Nscale and Anthropic are discussing a second building worth roughly $45 billion.
- Nscale had about 25,000 advanced AI chips running in August against nearly 500,000 planned; runoff from its West Virginia campus flooded nearby homes more than once, and the project won state certification in September.
- CoreWeave, Nebius and IREN each saw shares fall more than 30% in October as investors put pressure on neoclouds, which rent AI computing power without cash-rich core businesses.
- Anthropic filed to go public this week, and Blackstone warned investors it may receive a below-investment-grade rating; that outcome would raise borrowing costs and could push the AI buyer to keep relying on stronger partners for debt backing.
Why it matters: Nscale is seeking an IPO valuation of up to $35 billion despite concerns about delivering ambitious projects, so a guarantee from Nvidia would materially strengthen its construction financing. The proposal would also put Nvidia behind construction default risk while helping secure a major Vera Rubin customer tied to Anthropic’s $44.6 billion contract.
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