Abstract:
Nvidia disclosed in documents related to the second quarter financial report of fiscal year 2027 that the company has made land, power and main building facility guarantee commitments for some AI cloud service partners’ data center projects, with the maximum total risk exposure reaching US$108.5 billion. Among them, the scale of the commitment related to OpenAI’s construction of large-scale AI infrastructure in Ohio, USA, is particularly prominent.
As investment in generative AI infrastructure continues to heat up, NVIDIA is assisting some customers in obtaining the space, power resources and infrastructure conditions required for data center construction through investment, guarantees and credit support. Such arrangements have also raised questions about "revolving financing": Critics believe that Nvidia provides funds or support to customers, and these customers subsequently purchase its GPU products, which may form a closed loop of mutually supporting demand.
In this regard, Nvidia stated that AI cloud service providers and large model developers have extremely strong demand for computing infrastructure, but the business expansion rate of many companies has exceeded the range that their balance sheet strength and long-term credit status can support. Therefore, the company will assist specific customers in locking in data center construction sites when it can see clear and sustained demand that is sufficient to support the deployment of multiple generations of NVIDIA computing infrastructure.
According to NVIDIA’s chief financial officer’s explanation in the financial report, of the company’s largest total risk exposure of US$108.5 billion, US$3.5 billion is used to provide land, power and main building facility guarantees for the data center lease obligations of some AI cloud partners. If the relevant partners default, NVIDIA will bear the corresponding guarantee liability.
The vast majority of the remaining commitments are related to SB Energy's PORTS-Pike Technology Park in Ohio. Nvidia will provide credit support for the land, power and main building construction of the project to secure approximately 4.25 gigawatts of data center capacity. The park is expected to deploy OpenAI's computing infrastructure under a 20-year lease agreement and host Nvidia chips.
Nvidia pointed out that the relevant guarantee obligations will officially take effect after certain conditions are met, including that the data center will gradually become ready starting from the company's 2029 fiscal year. According to the agreement, if the park expands in the future, NVIDIA can also provide credit support for an additional 3.8 GW of capacity in phases, but the company has not yet disclosed the specific amount of this support.
Nvidia emphasized that these guarantee arrangements are expected to eventually be converted into its hardware sales revenue. The company estimates that each generation of NVIDIA AI infrastructure deployed in the PORTS-Pike park may correspond to approximately 1.5 million NVIDIA GPUs, bringing potential revenue of approximately US$150 billion to US$200 billion. With a lease term of up to 20 years, the park is expected to support multiple cycles of infrastructure upgrades.
Driven by the demand for AI computing power, Nvidia’s performance still maintains rapid growth. Its revenue in the second quarter of fiscal year 2027 increased by 106% year-on-year, net profit increased by 126% year-on-year, and gross profit margin increased by 2.6 percentage points to 75%.
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