Analysis-More questions than answers in Nvidia's $100 billion OpenAI deal

Investment Overview - Nvidia plans to invest up to $100 billion into OpenAI while supplying millions of AI chips to the company, a move that is unprecedented in the tech industry [1] - Nvidia will take a financial stake in OpenAI without receiving any voting power in return, indicating a unique investment structure [2] Financial Commitment - Nvidia's initial investment of $10 billion will be allocated towards building a gigawatt of capacity using its next-generation Vera Rubin chips, with construction expected to start in the second half of 2026 [3] - The total cost for building AI data centers is estimated at $50 billion per gigawatt, with Nvidia's chips and equipment accounting for approximately $35 billion of that cost [3][4] - OpenAI will require an additional $40 billion in capital for each gigawatt of capacity it plans to build, raising questions about the source of these funds [4] OpenAI's Structural Changes - OpenAI, currently a non-profit corporation, is exploring a transition to a for-profit structure to facilitate fundraising and a potential public offering [5] - Discussions have been ongoing with Microsoft regarding this structural change, and a tentative agreement has been reached for OpenAI to convert to a for-profit public benefit corporation, pending approval from state officials [6] Investment Timeline - Nvidia's initial $10 billion investment will not commence until a definitive agreement is reached between OpenAI and Nvidia in the coming months [7]