Nvidia guarantees its own chips’ value to unlock $500 billion in AI infrastructure financing

Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs, and KKR are set to mobilize over $500 billion for AI infrastructure. To make the math work, Nvidia is guaranteeing a portion of the residual value of its own chips.

Critics like investor Michael Burry consider the long-term value of those chips one of the biggest weak spots in the AI boom. Nvidia has signed letters of intent with six major financial firms to mobilize more than $500 billion in third-party capital for data centers, chip factories, and power plants. The partners are Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs, and KKR. According to the Financial Times, which broke the deal, Nvidia’s stock dropped about 1.4 percent afterward, wiping out more than $70 billion in market cap. Nvidia CEO Jensen Huang described the move on X as a shift from one-off projects to repeatable financing platforms. “AI factories” should be fundable as productive infrastructure, similar to power grids or transportation networks. Many AI companies have demand for compute but can’t access capital at the scale they need. Huang was clear that the $500 billion is an aggregate target spread over years, not Nvidia revenue, not a single fund, and not a commitment to any one customer. Nvidia didn’t share terms, individual commitments, or a timeline.Ad Nvidia backs up to 25 percent of its chips’ residual value Huang also addressed accusations that Nvidia’s financing of neoclouds and AI companies is circular. The company plans to support individual projects with residual-value guarantees. If the resale or reuse value of installed hardware falls below expectations at the end of a financing term, Nvidia covers part of the gap, up to 25 percent of a given transaction, reviewed on a project-by-project basis. The chipmaker is essentially taking on some of the depreciation risk on its own products. Huang says this share is “significantly lower” than in other compute financing arrangements, and that the actual credit assessment, meaning evaluation of the customer, demand, utilization, cash flow, and residual value, stays with the capital providers.AdDEC_D_Incontent-1 Nvidia regularly supports its partners in taking on debt, which in turn drives the company’s own revenue. The company is also negotiating a guarantee for a 10-gigawatt data center in Ohio leased to OpenAI. Huang’s argument reads like a direct response to Michael Burry’s depreciation warning Huang’s reasoning maps closely onto criticism from investor Michael Burry, who called the hyperscalers’ depreciation practices “one of the more common frauds of the modern era.” Burry argued that GPUs become obsolete too fast for five-to-seven-year useful lives because of Nvidia’s two-to-three-year upgrade cycle, and that depreciation would be understated by roughly $176 billion between 2026 and 2028 alone.Ad Huang now claims the opposite.