CNBC reports that the Nvidia OpenAI Ohio data centre partnership has been signed at a $105 billion guarantee, well below the $250 billion figure that had been under consideration, a reduction that has renewed investor anxiety about circular financing within the artificial intelligence industry.
Nvidia disclosed the final number, described as an ‘aggregate payment obligation’ capped at $105 billion, in a filing with the Securities and Exchange Commission. The Wall Street Journal had previously reported the guarantee had already been trimmed to ‘less than $120 billion’ before the companies settled on the lower figure when the deal was signed.
When reports surfaced in July that Nvidia could guarantee as much as $250 billion, the company’s shares fell about 4.5% intraday as investors reacted to concerns over self-financing loops in the AI sector.
Nvidia OpenAI Ohio data centre: how the financing works
Under the arrangement, Nvidia’s guarantee is designed to help SB Energy, the SoftBank-backed company developing the campus, secure external financing by supporting certain lease and power payments. It also guarantees the value of parts of the completed infrastructure should OpenAI default.
OpenAI will lease the data centre from SB Energy for as long as 20 years. Nvidia will be the exclusive chip provider for the initial phase and is separately investing $1.5 billion in SB Energy.
The campus is being built on a former US Department of Energy uranium-enrichment site in Pike County, Ohio. The first 800 megawatts are expected to become available in 2028 using existing AEP infrastructure, according to OpenAI. The broader development plans approximately 9.2 gigawatts of natural-gas generation, with the campus ultimately expected to reach as much as 8 gigawatts of computing capacity.
According to the PORTS-Pike Technology Campus, the new natural gas generation is funded in part through the historic US-Japan Strategic Trade and Investment Agreement and will be owned by the US Government.
SoftBank and SB Energy are expected to invest billions more in regional power infrastructure to support the build-out.
Circular financing concerns persist
The deal sits at the centre of a recurring debate: Nvidia, the dominant maker of AI chips, is helping finance the infrastructure that generates demand for its own hardware.
The company last week partnered with six major financial institutions to launch compute-financing platforms targeting more than $500 billion in third-party funding for AI infrastructure. That effort recently received a regulatory boost after SEC staff guidance concluded that certain data-centre debt falls outside Dodd-Frank securitisation rules, making it easier to mobilise outside capital.
A further complication surrounds OpenAI’s own leadership. CNBC reports that chief executive Sam Altman was an early investor in SB Energy, the company now developing the campus, an overlap that deepens questions about the interconnected web of relationships underpinning AI investment.
Nvidia chief executive Jensen Huang has rejected the circular-financing characterisation. In a press release he said the company was ‘securing long-lived infrastructure for Nvidia compute so OpenAI can deploy the most productive AI factories that can be upgraded repeatedly, with each new generation delivering more intelligence and better economics.’
Nvidia’s investor materials described the partnership as an integrated offering spanning architecture, chips, systems, networking, data centres, software, operations and financing. The company said each gigawatt of infrastructure would require roughly $50 billion to $60 billion in total spending, and that OpenAI would need to reinvest future revenue to fund its build-out.
‘We expect to use this capacity to meet growing demand for advanced AI and maintain our lead as the frontier AI research laboratory in pursuit of our mission,’ OpenAI said.
Reuters has noted that anxiety about the sustainability of AI investment persists despite record market performance, with investors increasingly focused on capital expenditure levels, rising debt and uncertainty over when returns will materialise. The Ohio campus, Nvidia says, is designed to be upgraded with each new chip generation.
