Tech Beetle briefing GB

Nvidia plans $30bn investment in OpenAI’s upcoming funding round

Essential brief

Nvidia is set to invest $30 billion in OpenAI’s next funding round, following the collapse of a previous $100 billion deal earlier this month. This inve

Key facts

Nvidia will invest $30 billion in OpenAI’s next funding round after a previous $100 billion deal dissolved.

OpenAI’s valuation is expected to reach $730 billion, nearly double that of competitor Anthropic.

The new investment does not require OpenAI to purchase Nvidia chips, marking a shift from prior arrangements.

OpenAI is diversifying chip suppliers, partnering with AMD and Broadcom amid competitive pressures.

Highlights

Nvidia’s earlier $100 billion deal with OpenAI was a letter of intent and was never finalized.

OpenAI’s market share for ChatGPT declined from 86.7% to 64.5% in the past year.

The upcoming funding round will raise about $100 billion with investors including Amazon, SoftBank, and Microsoft.

OpenAI is testing targeted ads to generate revenue, facing criticism from competitors.

Broadcom’s CEO indicated limited expectations for returns from its OpenAI investment in 2026.

Why it matters

Nvidia’s planned $30 billion investment in OpenAI underscores the evolving dynamics in the AI industry, where major players are adjusting partnerships and funding strategies amid rapid growth and competition. OpenAI’s diversification of chip suppliers reflects broader industry trends toward reducing dependency on single vendors, which could influence the development and deployment of AI technologies. The substantial funding round and high valuation also highlight the significant financial stakes and challenges in m...

Nvidia, the world’s most valuable chip manufacturer, is reportedly preparing to invest $30 billion in OpenAI’s forthcoming funding round after a previously announced $100 billion deal between the two companies fell through earlier this month.

OpenAI, the developer behind ChatGPT, is expected to be valued at approximately $730 billion in this round, nearly double the valuation of its competitor Anthropic, which recently raised $30 billion.

The earlier $100 billion agreement, announced last September, was framed as a letter of intent and involved Nvidia providing funds to OpenAI to purchase and deploy Nvidia chips for AI infrastructure.

However, reports emerged this month indicating that Nvidia’s commitment was never finalized, and OpenAI has since sought chip suppliers beyond Nvidia.

Under the new arrangement, Nvidia’s $30 billion investment will be exchanged for OpenAI stock without a binding obligation for OpenAI to purchase Nvidia chips.

The funding round is expected to raise around $100 billion, with participation from other major investors including Amazon, SoftBank, and Microsoft.

Despite the high valuation, OpenAI faces challenges in achieving sustainable profitability as it continues to burn cash and loses market share to competitors like Anthropic.

ChatGPT’s market share has declined from 86.7% to 64.5% over the past year, and OpenAI has begun testing targeted ads to generate revenue, a move criticized by rivals.

SoftBank, a key OpenAI backer, has stated that no final decisions have been made regarding its investment.

Meanwhile, OpenAI is expanding its partnerships to include other chipmakers such as AMD and Broadcom, though some of these deals carry uncertainties about their future impact.