Nvidia’s $US300 billion web of deals fuels dotcom echoes
The Australian Financial Review
ENRICHED
Details
- Date Published
- 7 Sept 2026
- Priority Score
- 2
- Australian
- Yes
- Created
- 7 Sept 2026, 02:00 am
Description
Critics compare Nvidia’s billions in customer financing to 1990s telecom gear makers, warning of massive losses if artificial intelligence demand cools down.
Summary
This report scrutinizes Nvidia’s aggressive financial engineering, including providing over $100 billion in backstops for data center construction to drive demand for its own chips. The expansion of high-compute infrastructure is a direct catalyst for the scaling of frontier AI capabilities, yet the article warns that financial instability in the supply chain could lead to a sudden market correction. Such economic volatility poses risks to the sustained funding of AI safety research and the orderly implementation of global governance frameworks if the 'AI bubble' bursts.
Body
The EconomistSep 7, 2026 – 10.32amIt took 30 years for Nvidia, an American firm whose chips power much of the world’s artificial intelligence, to reach a valuation of $US1 trillion ($1.4 trillion). Getting to $US2 trillion took only nine more months. It passed the $US5 trillion mark less than two years later. It is now the world’s most valuable company, worth about $US5.4 trillion. Next year, its sales are expected to almost double. Some analysts predict it will generate $1 trillion in annual revenue by 2029.It is not just chip making that has spurred Nvidia’s stunning growth, however. Its boss, Jensen Huang, has also resorted to financial engineering to boost demand for its wares. In mid-August, for example, Nvidia agreed to provide a backstop worth up to $US105 billion for a vast data centre in Ohio that will use lots of its chips.Loading...The EconomistSaveLog in or Subscribe to save articleShareCopy linkCopiedEmailLinkedInTwitterFacebookCopy linkCopiedShare via...Gift this articleSubscribe to gift this articleGift 5 articles to anyone you choose each month when you subscribe.Subscribe nowAlready a subscriber? LoginRead MoreAINvidiaAnthropicOpenAIGoogleData centresFirmus GridFetching latest articles