Six of the world's biggest money managers back a US$500 billion plan to fund the AI build-out
Nvidia has enlisted six of the world's largest asset managers to raise more than US$500bn for artificial intelligence infrastructure, in a push to turn computer chips into an asset class that investors can lend against.
The chipmaker said on Monday it had signed memorandums of understanding with Apollo Global Management, BlackRock, Blackstone, Brookfield Asset Management, Goldman Sachs and KKR to build financing platforms for its customers.
According to Nvidia, the platforms aim to mobilize more than US$500bn of third-party capital over time to fund data centres and the purchase of its hardware.
The structure lets hyperscalers, frontier AI labs and enterprises secure financing through institutional credit, insurance funds and private capital rather than their own balance sheets, CNBC reported.
"This is really the first time that technology chips have become an investable asset class," Jensen Huang, Nvidia's founder and chief executive officer, told CNBC.
He argued that because the company's hardware is widely adopted and can be transferred across customers, lenders can underwrite it as a revenue-generating asset with a long life.
That thesis challenges the conventional view of graphics processing units as hardware that depreciates quickly.
Nvidia's own statement described its compute as an investable asset offering "the lowest token cost, highest revenue and longest life."
Investors gave the news a mixed reception.
The Financial Times, which broke the story, reported that Nvidia shares fell about 1.4 percent after its report, erasing more than US$70bn in market value from the roughly US$5.25tn company.
Reuters said the stock was down more than 3 percent in afternoon trading.
Wall Street leaders framed the effort as a turning point for how AI gets funded.
Larry Fink, BlackRock's chairman and chief executive, told CNBC he saw the project as the start of the "next future for financial engineering," comparing it to the creation of mortgage-backed securities in the 1970s.
Some money has already been raised, and BlackRock will be "raising quite a bit more," he said.
"We need to raise this money as fast as possible and put this to work, because I think it's really imperative that the United States is the leader in AI in the world," Fink said.
Jon Gray, Blackstone's president, told the broadcaster that AI compute is becoming a "financeable asset class" in the way mortgage lenders assess homes, and said usage at the firm's portfolio companies had climbed sevenfold this year.
The financing drive lands amid record technology spending.
Combined AI outlays from Big Tech will top US$730bn this year, Reuters reported, while Morgan Stanley projects hyperscalers will spend US$3.5tn between 2026 and 2028, according to the FT.
Nvidia itself raised US$25bn through a US bond issuance in June, its first trip to the debt market since 2021.
The plan also carries risks that matter to lenders.
Nvidia frequently backs its own customers' borrowing, a circular pattern that has drawn concern about concentrated risk in the sector, the FT noted.
Ratings agency Moody's has warned that heavy capital spending is squeezing free cash flow and pushing technology giants into larger debt loads, per CNBC.
And while Huang casts GPUs as long-lived, law firm Dentons points to rapid obsolescence, noting that GPU hardware typically depreciates over three to four years and that bespoke AI facilities can become stranded assets in a downturn.
Apollo president Jim Zelter underscored the scale on an earnings call earlier this month.
"More than $8tn of capital is expected to be invested, a staggering sum," he said, according to the FT, adding that private capital could finance a portion of it alongside public markets.
Nvidia said the partnerships remain subject to final agreements.
