Nvidia Courts Insurers to Back Chip Loans as It Targets $500 Billion in AI Financing
Updated
Updated · Financial Times · Sep 29
Nvidia Courts Insurers to Back Chip Loans as It Targets $500 Billion in AI Financing
3 articles · Updated · Financial Times · Sep 29
Summary
Nvidia has held early-stage talks with insurers on covering losses tied to loans or leases backed by its AI chips, aiming to make financing easier for smaller cloud providers that cannot match Big Tech balance sheets.
The structures under discussion would protect lenders if a borrower defaults and pledged Nvidia chips cannot be resold for enough, extending Jensen Huang’s push to treat AI hardware as an investable asset class.
Nvidia has shared chip depreciation and future compute-pricing data with at least one insurer, and one person familiar with the talks said broker Howden Re is helping develop a structure that could also syndicate risk to hedge funds.
The effort follows Nvidia’s move last month to backstop part of financing deals meant to unlock $500 billion from Wall Street firms and its guarantee of $105 billion of leases for an OpenAI data center.
Valuation data remains central to the model: Barkr AI estimates an eight-GPU H100 system from 2022 is still worth about $320,000 today, but could fall to roughly $30,000 after six years if compute supply catches up.