CoreWeave expands OpenAI pact with new $6.5 billion contract

Core Insights - CoreWeave has expanded its partnership with OpenAI in a new deal worth up to $6.5 billion, increasing the total value of their agreements to $22.4 billion [1][2] - This marks the third major expansion of the partnership in 2023, following an initial deal in March worth up to $11.9 billion and a $4 billion add-on in May [2] - OpenAI is pursuing multiple partnerships to support its significant data center buildout to meet growing computational demands [2] Infrastructure Developments - OpenAI announced updates to its infrastructure project "Stargate," which includes opening three new sites with Oracle and building two additional data centers with SoftBank [3] - The combined capacity from these new sites, along with existing projects, aims to reach nearly 7 gigawatts of planned capacity and over $400 billion in investment over the next three years [4] - OpenAI's goal for the Stargate project is to secure a total of 10 gigawatts of capacity through an investment that could reach $500 billion [4] Industry Dynamics - The series of agreements highlights the convergence of interests among major tech companies in the AI sector and raises questions about "circular" financing and the sustainability of capital flow [5] - Nvidia's investment of up to $100 billion in OpenAI and its supply of data-center chips signifies a strong partnership between two leading players in the AI race [5] - Nvidia has also invested in CoreWeave, owning more than 5% of the company, and CoreWeave has made significant purchases of Nvidia hardware, including a $6.3 billion initial order this month [6]