OpenAI's Mega-Deals with Nvidia and Oracle Top $400B as Valuation Surges
OpenAI, the company behind ChatGPT, has recently inked massive deals with tech giants Nvidia and Oracle, valued at hundreds of billions of dollars. This comes as the company's valuation has surged by around 200 billion dollars since April this year, placing it at the top among unlisted companies, surpassing SpaceX.
OpenAI's latest mega-deals include a $100 billion partnership with NVIDIA to deploy at least 10 gigawatts of NVIDIA AI systems starting in 2026. Additionally, a $300 billion cloud computing deal with Oracle is set to commence in 2027, spanning over five years. However, these ambitious projects have sparked concerns about their feasibility, particularly regarding the immense electricity consumption required and uncertainties about meeting these energy demands.
Tech CEOs, including Mark Zuckerberg and OpenAI's own CEO Sam Altman, have openly discussed the possibility of an investment bubble in AI bursting. This conversation gains traction as OpenAI plans to transform from a foundation to a for-profit company, potentially involving Microsoft receiving shares in exchange for its investments. The extent of Microsoft's shares in OpenAI remains a contentious point in this proposed transformation. Analysts have expressed doubts about the feasibility of OpenAI's recent projects and the potential for an AI infrastructure investment bubble.
OpenAI's recent deals and valuation surge have placed it in the spotlight. As it plans to shift to a for-profit model, the tech world watches closely to see how these ambitious projects and potential transformations unfold, with feasibility and investment bubble concerns lingering in the background.
