Nvidia’s $250 Billion OpenAI Guarantee: A Bold Bet That Has Investors on Edge
Published on 07/28/2026 at 11:40 | Redaktion boerse-global.de
Nvidia’s stock slipped 5.02% on Monday to €172.88, and the trigger wasn’t a disappointing earnings report or a product delay. Instead, it was news of a deal that hasn’t even been signed. The chipmaker is reportedly in talks to provide a guarantee of up to $250 billion for OpenAI, a move that has laid bare the market’s growing unease over how the entire AI industry is financing its expansion.
The stock now trades at €171.18, down 5.90% over the past week, and sits 15.47% below its 52-week high of €202.50. The decline reflects a fundamental question investors are wrestling with: Is Nvidia evolving from a pure hardware supplier into a lender for the global AI infrastructure — and if so, what does that mean for risk?
A Financing Structure That Raises Eyebrows
The numbers involved are staggering. Beyond the $250 billion guarantee under discussion, reports suggest Nvidia could also co-finance an additional $350 billion in purchases. The funds would back a massive data center hub in Ohio, developed by a SoftBank subsidiary, with a planned investment of $500 billion and 10 gigawatts of capacity. A separate $50 billion leasing commitment for a Texas data center is also circulating, while a $5 billion strategic investment in Safe Superintelligence (SSI) has already been confirmed.
Yet there’s a glaring disconnect with Nvidia’s own balance sheet. The company’s most recent quarterly report caps its total guarantee volume for leasing obligations at $3.5 billion. A $250 billion commitment would be roughly 71 times that figure — a leap in scale that has analysts questioning how the company would manage such exposure.
Should investors sell immediately? Or is it worth buying Nvidia?
Critics have labeled this model “circular financing.” The logic: Nvidia gives customers capital, which they then use to buy Nvidia chips. The Bank for International Settlements recently flagged such arrangements as a major risk to global financial stability. OpenAI, notably, still isn’t profitable, and the broader AI sector carries heavy debt loads. If the monetization of AI software falters, Nvidia could be left holding massive liabilities.
The Bull Case: Securing Tomorrow’s Demand
Supporters see a different picture. They argue Nvidia is using its fortress-like balance sheet to lock in future demand in a market where chips remain scarce. CEO Jensen Huang has repeatedly dismissed accusations of circular financing, calling the idea “absurd” and noting that these sums represent only a fraction of what customers would need to raise on capital markets anyway.
The partnerships extend beyond OpenAI. Nvidia has struck a $500 billion alliance with South Korea’s SK Group to build so-called “AI factories” in Korea, and the SSI investment gives the company early access to the upcoming Vera Rubin platform. For bulls, these deals represent vertical integration at its smartest: Nvidia secures demand today and converts it into high-margin recurring revenue once the financed data centers go live.
Analysts seem to agree, at least on the upside. The average price target stands at €266.21, implying 55.5% upside from current levels. Morningstar analysts view the guarantee arrangements primarily as a growth lever that should help Nvidia sell more hardware and accelerate AI adoption. The stock’s 6.80% year-to-date gain and its 22.46% distance from the 52-week low of €139.78 are cited as evidence that the long-term story remains intact.
The Bear Case: A Debt Trap in the Making
The opposing camp focuses on the credit risk embedded in these “vendor-backed” financings. Investor Michael Burry described the OpenAI arrangement as further evidence of a self-reinforcing loop, quipping, “Round and round it goes.”
The mechanics are particularly concerning. OpenAI itself lacks an investment-grade rating, which is why the structure reportedly allows SoftBank’s SB Energy to borrow against Nvidia’s balance sheet rather than its own. A Bloomberg-quoted strategist put it bluntly: guaranteeing more of OpenAI’s data center debt deepens a supplier financing model already under scrutiny — and signals financial stress in AI infrastructure buildout as much as it signals demand.
The market is already showing signs of nervousness. Credit default swaps on Nvidia bonds have jumped recently. The stock trades 4.94% below its 50-day moving average of €180.08, suggesting weakening technical momentum. With a market capitalization of roughly €4.4 trillion, any significant correction would ripple across the broader market.
Nvidia at a turning point? This analysis reveals what investors need to know now.
The Technical Crossroads
For now, the 200-day moving average at €166.25 serves as the key battleground. As long as Nvidia holds above that level, the long-term uptrend remains intact. A sustained break below it would shift the narrative firmly toward the bear case.
The relative strength index sits at 41.8, approaching oversold territory — but a sustainable recovery likely won’t materialize until Nvidia provides clearer details on its new role as a global AI lender. The next major catalyst is the quarterly earnings report scheduled for August 26, 2026. Investors will scrutinize disclosures on the total scope of leasing and guarantee commitments, and how they impact the free cash flow margin, which stood at 45% last quarter.
In the shorter term, any official confirmation — or denial — of the $250 billion OpenAI guarantee will move the stock. This week’s earnings from Microsoft, Amazon, and Meta could also reset sentiment for the entire AI hardware sector, as their commentary on capital expenditure plans will signal whether the demand story holds up without artificial financial scaffolding.
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Nvidia Stock: New Analysis - 28 July
Fresh Nvidia information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.
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