Nvidia finalized a $105 billion guarantee behind an 8-gigawatt OpenAI data center in Pike County, Ohio, on Aug. 17, 2026, closing three weeks of public bargaining that started with a $250 billion figure and ended near half of it 146. The gap between the opening ask and the signed structure tells the sharper story: even the chipmaker sitting on the industry's fattest balance sheet found a limit to how much financial risk investors would let it carry for a single customer.
From Letter of Intent to Backstop
The Ohio guarantee traces to a September 2025 letter of intent, when Nvidia pledged up to $100 billion toward OpenAI, phased in as each gigawatt of capacity came online, tied to at least 10 gigawatts of Nvidia systems running on the Vera Rubin platform 1. Jensen Huang called it the product of a decade of mutual pressure: "Nvidia and OpenAI have pushed each other for a decade," he said at the announcement, adding that the pairing marked "the next leap forward" for both companies 1. Sam Altman framed the stakes at the level of macroeconomics, calling compute infrastructure "the basis for the economy of the future" 1. Greg Brockman, OpenAI's president, pointed to scale already achieved: the partnership's chips already ran systems serving "hundreds of millions of people" every day 1.
That original commitment stalled through the winter. Wikipedia's contemporaneous account of the partnership notes that by January 2026 the September MOU sat unrealized, with both companies reportedly rethinking its shape 6. Ambition returned that summer in bigger, riskier form: on July 27, CNBC and other outlets reported Nvidia and OpenAI negotiating a $250 billion backstop, structured as a debt guarantee sitting underneath fundraising by SB Energy, the SoftBank subsidiary building the physical campus, rather than a straightforward equity check 23. Reporting on the structure described the mechanics plainly: SB Energy planned to raise still more debt from unnamed lenders, and Nvidia's guarantee sat underneath that debt as the collateral making lenders comfortable extending it in the first place 3.
The Ohio Wager
Pike County sits roughly 50 miles from Columbus, on federal land chosen for a project whose total build cost reporting pegged near $500 billion for 10 gigawatts of capacity 3. Japan committed $33 billion to the buildout, and the arrangement grants the United States 90% of power revenue once Japan recoups its stake 3. Nvidia's guarantee, notably, excluded the chip purchases themselves — those sat in a separate negotiation reporting estimated near $350 billion, a sum layered atop the infrastructure backstop rather than folded into it 3.
Investor pushback arrived fast. The Wall Street Journal reported Aug. 14 that Nvidia trimmed its exposure to under $120 billion, citing concern among the company's own shareholders about concentrated risk tied to one counterparty 4. Three days later, the companies settled on final terms: an 8-gigawatt data center lease running 20 years, backed by a $105 billion Nvidia guarantee — smaller than the July proposal on every dimension, gigawatts included 6. Colette Kress, Nvidia's chief financial officer, oversees exactly this category of exposure on the company's books; Sarah Friar holds the parallel seat at OpenAI, managing a balance sheet built increasingly from guarantees, leases, and vendor commitments rather than cash on hand.
A Balance Sheet Crowded With Giants
Nvidia's Ohio guarantee joined a stack of OpenAI infrastructure commitments assembled across less than a year. AMD signed a deal in October 2025 covering six gigawatts of chips beginning with the MI450, paired with an option for OpenAI to acquire up to 160 million AMD shares — near a tenth of the company — contingent on deployment and share-price milestones 6. Oracle committed $300 billion in computing power to OpenAI over five years starting in September 2025 6. Stargate, the umbrella venture joining OpenAI, Oracle, SoftBank, and MGX, launched in January 2025 with a $500 billion estimate for the broader American buildout 6. Broadcom entered the picture too, partnering with OpenAI on a custom AI chip reportedly targeted for a 2026 rollout, a program explored at length elsewhere in this series.
Read together, the pattern departs from how prior computing cycles financed themselves. Cloud providers historically built data centers from retained earnings and conventional project debt; OpenAI's buildout runs increasingly on supplier-backed guarantees, where the company selling the chips also underwrites the debt that pays for them.
The Circularity Question
Analysts and reporters converged on a single label for that arrangement: circular financing. Coverage of the Ohio deal described it plainly as "a subtle, indirect subsidy from the US government, Japan, and Nvidia" flowing toward a single customer's infrastructure ambitions 3. The mechanics support the framing. Nvidia sells the graphics processors that generate its own record revenue, then backstops the debt that finances the buildings housing those same processors, creating a loop where the chipmaker's guarantee becomes collateral for demand it also supplies.
Nvidia's own scale-back four weeks after the July proposal surfaced reads as an implicit concession to that critique, even absent a public acknowledgment. Trimming a $250 billion commitment to $105 billion, and 10 gigawatts to eight, moved the deal from a bet the company's largest shareholders questioned to one they would underwrite. The circularity persists at smaller scale; the risk concentration eases.
A Quarter That Justifies the Bet
Nvidia's fiscal second-quarter results, reported Aug. 26, gave the guarantee a favorable backdrop. Data center revenue reached $89.0 billion, up 117% year over year, against total revenue of $96.2 billion 5. Huang's framing tied the surge directly to the kind of buildout Ohio represents: "AI has reached its inflection point," he said. "It's doing useful work. Its tokens are productive and profitable. Now, compute is revenue" 5. He described "a golden age of new AI labs and startups, multiple frontier labs scaling in parallel," with the infrastructure buildout running "at full steam" 5.
Numbers of that size complicate the skeptics' case even as the underlying critique persists. Triple-digit data center growth demonstrates genuine, paying demand for Nvidia's chips across a widening customer base, a fact the circular-financing critique tends to understate. Yet the same quarter that proves demand also proves concentration: a company reporting $89 billion in data center revenue guaranteeing $105 billion of debt for one customer's single campus illustrates precisely the scale mismatch analysts flagged when the $250 billion figure first surfaced.
By the numbers
- $105 billion: the final Nvidia guarantee behind the Pike County, Ohio, data center, finalized Aug. 17, 2026 6.
- Eight gigawatts: the finalized capacity of the Ohio lease, over a 20-year term, down from 10 gigawatts proposed in July 36.
- July 27 marked the day Nvidia and OpenAI's original $250 billion backstop figure became public 23.
- Six gigawatts: AMD's October 2025 chip commitment to OpenAI, paired with warrants for up to 160 million AMD shares 6.
- Nvidia's fiscal second-quarter 2027 data center revenue hit $89.0 billion, up 117% year over year 5.
- $33 billion: Japan's committed contribution to the Ohio project's buildout 3.
- Oracle's five-year computing power contract with OpenAI, signed September 2025, totals $300 billion 6.
What to watch
SB Energy's actual debt raise, once lenders price the finalized $105 billion guarantee, will show whether Aug. 17's terms satisfied the market skepticism that forced the July figure down. Nvidia's fiscal third-quarter report, due in November, should reveal whether data-center growth sustains its 117% pace or begins the deceleration analysts model against a shrinking base of comparison. OpenAI's parallel commitments to AMD, Oracle, and Broadcom bear watching for signs of sequencing: whether each supplier's guarantee gets called on schedule, or whether the Ohio pattern of ambitious announcement followed by negotiated shrinkage repeats across the rest of the stack.
Sources
- Nvidia Newsroom, "OpenAI and NVIDIA Announce Strategic Partnership to Deploy 10 Gigawatts of NVIDIA Systems," Nvidia Newsroom, Sept. 22, 2025, https://nvidianews.nvidia.com/news/openai-and-nvidia-announce-strategic-partnership-to-deploy-10gw-of-nvidia-systems
- CNBC Staff, "Nvidia and OpenAI in talks for up to $250 billion backstop to fund AI infrastructure plans," CNBC, July 27, 2026, https://www.cnbc.com/2026/07/27/nvidia-and-openai-in-talks-for-up-to-250-billion-dollar-ai-backstop.html
- Yahoo Finance Staff, "Nvidia Guarantees $250B for OpenAI So Everyone One Day Can Get Paid," Yahoo Finance, July 27, 2026, https://finance.yahoo.com/technology/ai/articles/nvidia-guarantees-250b-openai-everyone-193929851.html
- MarketScreener Staff, "Nvidia scales back $250 billion OpenAI data center guarantee, WSJ reports," MarketScreener, Aug. 14, 2026, https://www.marketscreener.com/news/nvidia-scales-back-250-billion-openai-data-center-guarantee-wsj-reports-ce7859dfda88f022
- Nvidia Newsroom, "NVIDIA Announces Financial Results for Second Quarter Fiscal 2027," Nvidia Newsroom, Aug. 26, 2026, https://nvidianews.nvidia.com/news/nvidia-announces-financial-results-for-second-quarter-fiscal-2027
- Wikipedia contributors, "OpenAI," Wikipedia, accessed Sept. 1, 2026, https://en.wikipedia.org/wiki/OpenAI