Nvidia CEO Jensen Huang announced a $500 billion financing plan with six major asset managers (BlackRock, Blackstone, Apollo, KKR, Brookfield and Goldman Sachs) to fund data centers and GPU clusters for companies unable to afford purchasing the chips outright. The plan hinges on the assumption that Nvidia GPUs will hold their value over time, functioning like hard assets rather than fast-depreciating consumer electronics. The primary risk comes from China, which could flood the market with low-cost AI chips, triggering a price collapse that erodes the collateral backing these loans. To compensate for this risk, investors are expected to demand high-yield returns in the 11% to 17% range. Nvidia currently dominates the U.S. AI chip market with over 75% market share, and H100 chip rental rates have risen from $1.70 to $2.35 per GPU-hour.
Source: Read the original article
