Something shifted this weekend. And it’s not a product launch or a guidance raise.
According to a Wall Street Journal report, Nvidia is in talks to provide roughly $250 billion in financing guarantees for OpenAI as part of a massive data center project in southern Ohio. The proposed campus, developed by SoftBank’s energy subsidiary (SB Energy), could ultimately cost more than $500 billion in total and require 10 gigawatts of power. Nvidia would guarantee financing tied to the data center lease and the project’s future financing; the report also said Nvidia has discussed separate financing related to OpenAI’s Nvidia chip purchases that could total another $350 billion.
That last part is worth slowing down on.
Nvidia guaranteeing the financing for a customer to buy Nvidia chips. Michael Burry reacted on X with: “Around and around we go.” He had just added to his short position in NVDA on Friday. He’s not alone in raising an eyebrow.
What the Business Actually Looks Like
Before the noise, here are the numbers. Nvidia posted Q1 fiscal 2027 revenue of $81.6 billion, up 85% year over year. Data center revenue surged 92% to $75.2 billion. Free cash flow hit $48.6 billion in the quarter alone. The company guided Q2 to $91 billion in revenue, well above the $86.8 billion consensus at the time. Gross margins are running at 74.9%.
Fiscal year 2026 revenue was $215.9 billion, up 65% from the prior year. The next earnings report lands August 26.
For OpenAI, the deal would be a first step toward owning its own infrastructure rather than renting capacity from Microsoft, Amazon, and Oracle. For Nvidia, it locks in chip demand for years. That’s the bull case framing.
The Part People Are Skipping
The bear case isn’t really about the business fundamentals. It’s about what this deal says about the structure of demand.
If Nvidia has to backstop its own customers’ financing to keep building the infrastructure that generates chip orders, that raises a question about the organic sustainability of demand. It’s circular in a way that deserves scrutiny. And the deal is still in talks, not signed.
Slight tangent: Microsoft, Google, and Anthropic have also reportedly expressed interest in the Ohio site. So even if OpenAI anchors it, this campus could become something much larger than a single-tenant agreement.
Where the Stock Sits
NVDA is currently trading around $207, roughly 12% below its 52-week high of $236.54 hit in mid-May. The stock has a market cap above $5 trillion. Analyst consensus is a Strong Buy with an average 12-month target around $302. The stock trades at about 35x normalized earnings.
Technically, the stock is holding above its 200-day moving average and sitting near a key support cluster around $205. A close below that zone opens a test toward $203.
Bull / Base / Bear
- Bull: The Ohio campus confirms multi-year demand visibility. Q2 earnings on August 26 hit or exceed $91B guidance. The OpenAI deal is a strategic masterstroke that locks in revenue and ecosystem control.
- Base: Nvidia continues to compound revenue at 40-50% annually. The OpenAI deal closes at reduced scale. August 26 sets a new floor for the stock.
- Bear: The circular financing structure draws regulatory scrutiny. Customer concentration risks surface. Competing architectures from AMD, custom silicon, and others erode the data center monopoly over 18-24 months.
What to Watch
August 26 is the only date that fully resolves this. That’s when the Q2 number either validates the $91B guidance or cracks it. The hyperscaler earnings this week from Meta and Microsoft will also signal whether AI capex is still accelerating or flattening. Watch those carefully. They are Nvidia’s demand signal before Nvidia reports its own.
The OpenAI deal is fascinating. It’s also not confirmed. That tension is worth sitting with through the next 30 days.
For informational purposes only.