Nvidia's $100B OpenAI Deal Collapses, Replaced by Equity

The initial $100 billion infrastructure agreement between Nvidia and OpenAI, announced in September 2025, was never finalized as a binding contract. Eight months later, this framework has been abandoned and replaced by a new arrangement. Nvidia's commitment was contingent on infrastructure deployment, a condition that introduced significant execution risk.

Instead of the original agreement, OpenAI announced an $110 billion funding round on February 27, 2026, which later expanded to $122 billion by March 31, 2026. Nvidia invested $30 billion in this round as a direct equity stake, valued at $852 billion post-money. This new structure also includes binding hardware commitments from OpenAI for 5 gigawatts of Nvidia's Vera Rubin compute systems.

While OpenAI generated over $20 billion in annualized revenue by the end of 2025, it faces significant cash burn, projecting a $14 billion loss for 2026 and not expecting profitability before 2030. OpenAI is also diversifying its chip suppliers, committing to AWS Trainium compute and deals with Cerebras and Broadcom.

The revised Nvidia-OpenAI relationship provides Nvidia with a $30 billion equity stake and confirmed hardware demand through 5 gigawatts of compute commitment. Investors should note the circular capital dynamics and OpenAI's ongoing cash burn as key risks.