Nvidia backs OpenAI Ohio data center with $105B guarantee

Nvidia has agreed to provide a credit guarantee of up to $105 billion to support OpenAI's 20-year lease of a massive AI data center in Ohio, and will invest $1.5 billion in the project's developer, SB Energy. The deal, announced Monday, is the latest in a series of financing maneuvers by the chipmaker to fuel the AI infrastructure buildout, but it has also intensified scrutiny over circular funding flows between Nvidia and its largest customers.

The deal

SB Energy, backed by SoftBank and OpenAI, will build and operate the campus at the PORTS-Pike Technology Campus in Pike County, Ohio. The initial phase covers 4.25 gigawatts of computing capacity, with an option to expand to 8 gigawatts. Nvidia will be the exclusive chip provider for the first half of the site. The guarantee covers only the shortfall if OpenAI defaults and SB Energy cannot relet or sell the site at a minimum value, not the full lease cost. Nvidia also holds an option to invest an additional $1.5 billion in SB Energy, according to The Information.

The reaction

Critics and analysts have questioned the circularity of Nvidia financing the very infrastructure that buys its chips. "Investors are right to be worried about what seems to be a never-ending loop of AI deals," said Danni Hewson of AJ Bell. Nvidia CEO Jensen Huang defended the arrangement, saying it is "not circular financing" but rather securing "long-lived infrastructure for Nvidia compute." The deal follows Nvidia's $500 billion financing initiative with six Wall Street firms, which some legal experts say is supported by recent SEC guidance that exempts certain data center debt from risk-retention rules.

What's next

SB Energy and SoftBank plan to build at least 10 gigawatts of new power generation and invest $4.2 billion in grid infrastructure. The project is expected to create about 35,000 construction jobs through 2032. Capacity is expected to come online in phases starting in 2028. Huang said the site could contribute as much as $200 billion to Nvidia's revenue.