Nvidia says there's 'no assurance' of final agreement with OpenAI despite $100 billion pact

In a recent update, Nvidia's CEO Jensen Huang and OpenAI's leader Sam Altman had previously made headlines with a landmark agreement in San Jose, California. This partnership was set to see Nvidia invest a staggering $100 billion over several years, beginning in 2026, as OpenAI's AI supercomputing facilities become operational. However, the specifics regarding the timing and costs associated with each data center were not disclosed. In Nvidia's quarterly financial report released this week, the company highlighted a crucial distinction between a mere announcement and a binding contract. They stated, "There is no assurance that we will enter into definitive agreements with respect to the OpenAI opportunity or other potential investments, or that any investment will be completed on expected terms." This cautionary note has drawn attention from investors. Recently, Nvidia has been aggressively investing, channeling its increasing cash reserves into supporting companies that utilize its graphics processing units (GPUs). Alongside the OpenAI deal, Nvidia also disclosed a $5 billion investment in Intel and a commitment of up to $10 billion in Anthropic. While an OpenAI representative refrained from commenting directly, they referenced Huang's remarks during the earnings call, where he characterized OpenAI as a "once-in-a-generation company" and expressed optimism about the potential returns from the investment. Despite the uncertainty surrounding the September agreement, Nvidia's executives remain optimistic about their collaboration with OpenAI. Nvidia's CFO Colette Kress noted during the earnings call that OpenAI's user base has surged to 800 million, with enterprise clients reaching 1 million, alongside healthy gross margins. She emphasized the ongoing efforts to forge a strategic partnership focused on developing at least 10 gigawatts of AI data centers. Huang further affirmed that "everything that OpenAI does runs on Nvidia today." However, OpenAI is also exploring partnerships with Nvidia's competitor, Advanced Micro Devices (AMD), which has agreed to deploy 6 gigawatts of AMD's Instinct GPUs starting in the latter half of next year. This AMD agreement includes critical contractual elements missing from the Nvidia deal, such as signed commitments and stock warrants tied to deployment and performance metrics. As the competition in the AI sector intensifies, the future of Nvidia's investment in OpenAI remains to be seen, with both companies navigating a landscape filled with potential and uncertainty.