Buy Hold Rant
Nvidia's $100 billion investment in OpenAI A win win for tech and humanity
9/27/2025, 8:34:04 PM
Economic Summary
- NVIDIA (NVDA) reportedly purchased a very large stake (~$100 billion) in OpenAI, which could channel significant future demand for NVIDIA chips as OpenAI spends capital on compute.
- Critics call the transaction circular, but supporters argue OpenAI's revenue comes from end-users, so NVIDIA's investment mainly secures compute demand rather than capturing OpenAI revenue.
- The deal implies strengthening of NVIDIA's AI moat and higher hardware demand, with potential PR or regulatory scrutiny due to perceived self-dealing.
Bullish
- NVIDIA's stake aligns incentives: OpenAI will likely buy large amounts of NVIDIA chips.
- Investment effectively secures a major, high-margin customer and reinforces NVIDIA's AI leadership.
Bearish
- The deal looks circular — NVIDIA investing in a top customer could be seen as self-dealing or optics risk.
- Concentration risk if OpenAI becomes overly dependent on NVIDIA hardware.
Bullish tickers
NVDAOPENAI
Bearish tickers
NVDAOPENAI
NVDA
Bullish
Large stake in OpenAI should drive sustained chip demand and reinforce NVIDIA's AI compute dominance.
Bearish
Perceived circularity and concentration risk; optics could attract criticism or regulatory scrutiny.
OPENAI
Bullish
With large capital, OpenAI can scale products and will likely purchase substantial NVIDIA compute resources.
Bearish
Dependence on a single dominant hardware supplier could be seen as risky or controversial.