Analyst Highlights Red Flags in Nvidia (NVDA)-OpenAI $100 Billion Deal – ‘Feature of Past Bubbles’

Core Insights - NVIDIA Corporation (NASDAQ: NVDA) is under scrutiny due to a $100 billion deal with OpenAI, with analysts suggesting the company may be "losing" on this deal [1][2] - The company is providing significant vendor financing, with hundreds of millions involved, but only about $35 million is expected to contribute to future revenue, indicating a potential loss [2] - NVIDIA's annual revenue growth has slowed to 56%, down from nearly 100% YoY growth in previous quarters, highlighting increased competition and capital expenditure limitations [3] Company Performance - Despite slowing growth, NVIDIA is expected to continue expanding due to its strong position in the data center market and rising demand [4] - The introduction of the next-generation Blackwell architecture has led to significant performance improvements, offering up to 30 times faster inference capabilities and enhanced energy efficiency [5] - The company has shown resilience amid geopolitical tensions, with sovereign deals in regions like the Middle East and Taiwan helping to mitigate the impact of U.S. export restrictions on sales to China [5] Competitive Landscape - Increasing competition from major companies, such as Broadcom, is anticipated to affect NVIDIA's margins in the long term [4] - The capital intensity required for building AI infrastructure is highlighted, with monetization outside of in-house applications remaining unclear [2]