Amazon Taps $8 Billion Sale-Leaseback for Nvidia AI Chips
Amazon is exploring an $8 billion sale-leaseback of Nvidia artificial intelligence chips to transfer them to outside investors. The strategy, which includes transferring thousands of AI chips across multiple data centers in the US, aims to relieve Amazon's balance sheet from the burden of expensive AI infrastructure investment while maintaining computing capacity.
The Financial Times reports that Amazon is discussing the sale-leaseback with investors through a special purpose vehicle (SPV) that will issue bonds to raise capital. Amazon will then lease the chips back and continue using them in its data centers, reducing the financial burden of carrying expensive AI chips directly on its books.
The deal would allow Amazon to offload approximately $8 billion in asset exposure while maintaining use of its AI chips. The move is part of a broader trend of treating semiconductors as financial assets, with companies like Nvidia building out chip-based financing markets and partnering with Wall Street firms to create large-scale infrastructure financing platforms.
Astronomical investment costs in AI have driven this trend, with Amazon's projected capital expenditures for the year standing at approximately $220 billion. The surge is attributed to aggressive investment in data centers and AI infrastructure, centered on its cloud business, Amazon Web Services (AWS).