Nvidia Invests Big in AI-Focused Data Center Deal with SB Energy
Nvidia has announced a significant investment in SB Energy to support OpenAI's data center in Ohio, sparking both excitement and concern among investors.
The $1.5 billion deal guarantees land, power, and shell infrastructure for 4.25 gigawatts of initial capacity over 20 years, with the option to extend that support to another 3.75 gigawatts, bringing the potential footprint to 8 gigawatts.
Nvidia's investment is a direct attempt to secure physical infrastructure sites, marking its first move into this space rather than just supplying chips for data centers. The company estimates that each generation of AI factory systems deployed at the site could represent roughly 1.5 million GPUs, potentially translating into $150 billion to $200 billion in Nvidia revenue per generation.
Nvidia has directly addressed concerns about 'circular financing,' stating that OpenAI will pay the lease for the data center, rather than relying on Nvidia's guarantee alone. This arrangement does not constitute circular financing because it is based on defined portions of lease and power payments, along with a residual-value commitment.