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Two powerful American technology companies' mega deal may be called off, despite the public announcement of commitment.
OpenAI and Nvidia announced a $100 billion deal in November, stating in a memorandum of understanding that the latter would invest the large chunk of change to help the former build at least 10 gigawatts of computing power.
But that deal may be falling apart as insiders told the Wall Street Journal (WSJ) that the deal has yet to get outside of the preliminary stage.
Both sides are reconsidering the deal, and Nvidia Chief Executive Jensen Huang has privately criticized Sam Altman's company's approach to business, insiders said.
Huang is also worried about competitors' growth, such as Google's Gemini and Anthropic - where the latter he has also promised a large sum of money.
A Nvidia spokesperson told WSJ that OpenAI is still its preferred partnership, and it is still working with the artificial intelligence company on a deal.
OpenAI told WSJ: 'Our teams are actively working through details of our partnership. NVIDIA technology has underpinned our breakthroughs from the start, powers our systems today, and will remain central as we scale what comes next.'
For Nvidia to completely walk away from the deal is unlikely as OpenAI is one of its biggest investors, insiders told WSJ.
Nvidia Chief Executive Jensen Huang (pictured) and OpenAI's Sam Altman announced an intent to make a $100 billion deal in November
Both sides are reconsidering the deal, and Nvidia Chief Executive Jensen Huang has privately criticized Sam Altman's (pictured) company's approach to business, insiders said
However, Nvidia is investing in other competitors, like Anthropic, which announced up to a $10 billion investment in the company.
If the deal between OpenAI and Nvidia goes through, the first gigawatt of Nvidia systems will be deployed in the second half of 2026, it said in the letter of intention last year.
The Nvidia-OpenAI partnership came 10 days after OpenAI said it had reached a new tentative agreement that would give Microsoft a $100billion equity stake in its for-profit corporation. OpenAI is technically controlled by its nonprofit.
Altman said the new data centers that Nvidia will build are in addition to the previously announced projects.
'Building this infrastructure is critical to everything we want to do,' Altman said at the time. 'Without doing this, we cannot deliver the services people want. We can’t keep making better models.'
He said both Nvidia and Microsoft are 'passive investors,' and OpenAI’s nonprofit and board controls the company.
OpenAI was founded as a nonprofit in 2015 and its nonprofit board has continued to control the for-profit subsidiary that now develops and sells its AI products.
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