Lambda Secures $1 Billion in Private Debt for Nvidia GPU Deal

Lambda has secured $1 billion in private debt to purchase Nvidia GPUs that Microsoft will lease. This deal, arranged by JPMorgan, is the second such raise this month for Lambda.

The structure of the deal allows Lambda to borrow against Microsoft's willingness to pay, rather than its own revenue. This means that Microsoft gets access to the compute power without taking on debt.

Lambda has also been in talks with investors about raising as much as $3 billion ahead of a possible listing next year. The company is not alone in this space, as Nebius, an Amsterdam-headquartered firm, raised $775 million against its own GPUs earlier this year.

Nebius holds a five-year contract with Microsoft worth $19.4 billion and has said it could securitize another $40 billion in contracts. The deal highlights the growing trend of companies financing themselves against American leases, which some have warned could pose risks to credit markets if an AI investment collapse were to occur.